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Member, Beacon International Group, Ltd.
WASHINGTON—Two key House Republicans have asked Treasury Secretary Timothy Geithner and Neil Barofsky, the special inspector general for the Troubled Asset Relief Program, for an audit of the federal government’s trust arrangements for American International Group Inc.
In a letter sent Monday, Reps. Darrell Issa, R-Calif., the ranking member of the House Committee on Oversight and Government Reform, and Spencer Bachus, R-Ala., the ranking member of the House Financial Services Committee, said they wanted an audit conducted of “the formation, content and operation of these (AIG) trust arrangements and the degree to which the public can be confident in their ability to hold the trustees accountable.”
The AIG Credit Facility Trust Agreement was established to manage the government’s ownership stake in AIG.
“It is not clear how the American people can hold the AIG trustees accountable for their actions,” wrote the congressmen. “While the trustees have the discretion to exercise full control over AIG, since the American taxpayers own nearly 80% of its shares, the trustees cannot be fired if their decisions conflict with the preferences of government officials.
“This raises a troubling and urgent question: who can the American taxpayers hold accountable if the trustees make a decision that is not in their best interest?” they wrote, adding “if the AIG trust is going to be the model for the delegation of the management of the public’s shares in Citigroup and other bailed-out companies, the American people have a right to know how these trusts are going to be designed, how they will operate, and how the trustees can be held accountable.”