JP Morgan Chase & Co (JPM)

[JimsZ]

What are they hiding? Are they afraid Johnny Q Public is going to see that Wamu was in better shape than JPM/BAC/WFC if not for their "Emergency Loans" were given by the FED... Those same loans Wamu wasn't afforded


http://www.foxbusiness.com/markets/2010/10/26/banks-disclosure-case-supreme-court/


Banks Take Disclosure Case to Supreme Court
By Dunstan Prial

Published October 26, 2010
| FOXBusiness
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Reuters

The Clearing House Association, a trade group of the largest commercial banks, has appealed a court ruling that requires the government to reveal the names of banks that accepted emergency loans during the worst of the recent financial crisis.

The organization, which includes Bank of America (BAC: 11.31 ,+0.16 ,+1.43%), JPMorganChase (JPM: 37.26 ,+0.18 ,+0.49%), Citigroup (C: 4.18 ,-0.02 ,-0.48%) and Wells Fargo (WFC: 25.92 ,+0.17 ,+0.66%), among others, wants the Supreme Court to decide the case.

A judge ruled in August 2009 that the Federal Reserve has to release the information.

Media outlets, including Fox Business Network and Bloomberg News, had sued the Fed, which issued the emergency loans, seeking the information under the Freedom of Information Act, or FOIA.

The Fed on Tuesday declined to join the appeal.

The Clearing House said in its court filing that the Fed has never revealed the identities of borrowers from its discount window, the lending facility where banks get short-term funding and the source of the 2008 emergency loans.

Steven G. Mintz, an attorney representing Fox Business in its FOIA cases, said the American public has a right to know which banks borrowed taxpayers’ dollars from the Fed, and how much they borrowed.

Mintz questioned why the Fed is still refusing to release the information despite the fact it is no longer challenging the lower court’s ruling.

“I am absolutely furious that the Federal Reserve want the American public to believe they are in favor of transparency when they are still refusing to produce documents that they are no longer mounting a legal challenge against,” Mintz said.

“They are now letting the Clearing House Association -- the banks that they’re supposed to be regulating -- do the dirty work for them by continuing to hide information from the American public,” he added.

In late 2008, as the subprime mortgage crisis left many U.S. banks teetering on the brink of collapse, the government argued that releasing the names of banks that accepted emergency loans from the Fed’s discount window could potentially turn a bad situation worse.

According to that defense, depositors, fearing the loss of their life savings, might cause a run on institutions named as having accepted emergency loans.

The Clearing House said in its appeal, “Disclosure of this information threatens to harm the borrowing banks by allowing the public to observe their borrowing patterns during the recent financial crisis and draw inferences – whether justified or not – about their current financial conditions.”

In a statement, the Clearing House defended the government’s response to the financial crisis and said revealing the names of emergency borrowers could be harmful in future emergencies.

“Unless the ruling is overturned by the U.S. Supreme Court, businesses and individuals may decline to participate in these programs, possibly impairing the federal government’s ability to act effectively in times of crisis,” the organization said.

If the Supreme Court agrees to hear the case, a ruling isn’t expected until some time next year.

Mintz noted that Congress has already ordered that much of this information be released. The Wall Street Reform and Consumer Protection Act, also known as the Dodd-Frank Bill, passed in July, requires that the Fed release information related to emergency loan programs.

“I think we have learned as a result of the financial meltdown that more information is better than less information, and secrecy in the financial markets is a form of economic poison,” said Mintz.

This is one of several FOIA cases Fox Business has initiated in the wake of the financial crisis in an effort to force government disclosure and account for billions of taxpayer dollars used to prop up troubled banks.

Earlier this month, President Obama repealed a controversial provision in the recent financial reform legislation that made it easier for the Securities and Exchange Commission to deny requests for information.

Repealed was a little-noticed measure, Section 9291, that said the SEC no longer had to comply with virtually all requests for information from the public, including those filed under FOIA.

The Fox Business Network first reported the provision and its potential impact in July after the SEC cited the new law in a FOIA action brought by the network.

After Fox Business reported on the law and it was widely covered by the media, many members of Congress admitted that they were unaware of its inclusion in the vast Dodd-Frank reform bill.

The SEC defended the provision, suggesting it would help the agency in its efforts to expand its surveillance and investigations by ensuring that information obtained from banks and other financial institutions remained confidential.

Critics of the measure said more transparency is needed rather than less.