Mystery: What Is Citigroup's Secret Agreement With The Government?

Yesterday the Treasury Department began releasing documents related to the TARP. Mostly, they are agreements with financial instituitons and automobile companies that have been bailed out with government money. Reporters at the Wall Street Journal noticed something odd about the agreement with Citigroup: the bank checked a box indicating that it is operating under a regulatory agreement that could subject it to greater restrictions on its operations.

The odd thing is that Citi won’t say what this agreement is, or even who it is with. We know that it is a new agreement because when Citi was asked the same question in October it said it was not operating under any kind of regulatory agreement. So what’s going on?

It seems that the Obama administration should be able to clear this matter up right away. And Citigroup also should disclose it. So far, however, neither the government or the bank are speaking about it. The agreement could be something relatively minor, perhaps having to do with auction rate securities or something. But shouldn’t we at least be told which agency the agreement is with. What purpose is this secrecy serving?

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