An inquiry has been announced into the government bail-out of US insurance giant AIG. There might be lessons from this for Ireland. Although the government's proposed inquiry does not have the power to examine the bail-out, if information about conflicts of interest and bad deals for the tax-payer leak out, it will be difficult to dodge calls for an investigation into the government's actions during the height of the crisis. For the moment, the government is safe because we haven't had revelations on the AIG scale here.
From BBC News report:
AIG was initially bailed out for $85bn (£52bn), but its total rescue package has since amounted to more than $180bn.
"Issues have come to light that call into question whether the government has been, and is being, as transparent as possible with the American people," said Mr Barofsky [special investigator general for the US's Troubled Asset Relief Program (Tarp)] in a prepared testimony.
"Documents have come to light that were not provided to the [watchdog] audit team during the course of the audit."
The committee is investigating why the New York Federal Reserve, then headed by US Treasury Secretary Timothy Geithner, paid AIG business partners face value for assets so they would cancel contracts with the insurer.
A report published by Mr Barofsky's office in November last year criticised both the New York Fed and the US Federal Reserve for not using their "considerable leverage" to force AIG's counterparties to accept less for these assets, thereby wasting taxpayer money.
As a result, 16 banks, including Goldman Sachs, Deutsche Bank, Societe Generale and Royal Bank of Scotland, were paid more than $62bn.