Remember the infamous meeting when then Treasury Secretary Hank Paulson had the heads of 9 major banks come down to Washington? It was then that he made them the offer they couldn’t refuse. Take TARP cash, or else!
Now Judicial Watch — the conservative watchdog organisation which was famous for giving the Clinton administration fits — has uncovered secret documents from that meeting via the Freedom of Information Act. A few of them are really quite stunning.
The first 1-pager is Paulson’s talking points for the bank. It basically confirms that he put a gun to all their heads. It says they must agree to take their cash, and that if they protested, then each bank’s regulator would force them to take it anyway.
The next document is perhaps even more mindblowing. It’s the one-page agreement whereby each CEO agreed to let the government make its preferred stock injeciton. As you can see, both the amounts of the injection and the name of the bank are just handwritten scrawl.