At a hearing Thursday, senators wondered why Citigroup had dipped from the TARP pot reserved for "healthy" banks. Several senior government watchdogs pledged to investigate why Citigroup and Bank of America, also on the rocks, were included in the payout intended for their healthier counterparts, along with other lapses by Treasury officials. Fitch Ratings downgraded both Bank of America and Citigroup to BB, a "junk" rating two steps below investment grade.
Meanwhile, President Barack Obama announced a plan to cap executive pay at $500,000 Wednesday for companies like Citigroup that have leaned heavily on bailout money. The plan would allow executives to receive greater compensation in the form of restricted stock that can't be sold until loans from the Treasury are paid off. As we've reported, loopholes abound.
Bernard Madoff's client list -- 162 pages, adorned with the names of such luminaries (PDF) as director Steven Spielberg and baseball hall-of-famer Sandy Koufax -- was made public in a court filing Thursday.
A former investment manager, Harry Markopolos, told the House Financial Services subcommittee Wednesday that for eight years, his warnings about Madoff fell on deaf ears at the Securities and Exchange Commission. Fearing reprisal for his attempts to blow the whistle on the alleged Ponzi scheme, Markopolos testified that he submitted reports to the SEC anonymously (PDF) and wore gloves in some cases to avoid fingerprint identification.
Of course, Markopolos appears to be right about Madoff, to the tune of $50 billion. Reuters reported that a trustee assigned to investigating client's claims had recouped $946 million as of Tuesday. That means, so far, Madoff's investors have recovered about 2 cents on the dollar.
Eleven former Gitmo detainees completed a Saudi terror-rehab program, but then returned to their militant ways, Saudi officials said Tuesday. Their recidivism comes to light as the complications and obstacles to the Obama administration's review of detention policy stack up.
Another court case was put on hold Wednesday: Mohammed Jawad was captured as a teenager in 2002 and has been held at Guantanamo Bay ever since. His trial was scheduled to begin this month but has put on ice in response to President Obama's call for a review of all Gitmo cases. Meanwhile, it remains unclear what the president will do with detainees after Guantanamo closes, and if the commissions are scrapped. The Associated Press has some suggestions. But Obama predicts a difficult resolution: "We've got a couple hundred of hard-core militants that, unfortunately, because of...some problems that we had previously in gathering evidence, we may not be able to try in ordinary courts but we don't want to release."
Leon Panetta, the presumptive CIA chief, promised he wouldn't use torture as an intelligence gathering technique, but said he'd leave the final decision to the Commander in Chief. Asked by senators during his confirmation hearing Thursday whether he'd resort to more aggressive interrogation techniques when time is of the essence, he said, "I would not hesitate to go to the president of the United States and request whatever additional authority I would need."