As Citigroup Spun Toward Insolvency in ’07- ’08, Its Regulator Was Dining and Schmoozing With Citi Execs


Geithner was able to get in and out of Washington DC pretty much unscathed. But his legacy will haunt the Treasury for a good while.

I will say that he did his job – for the banks.

(From Wall Street on Parade)

In an article by Jo Becker and Gretchen Morgenson published by the New York Times on April 26, 2009, Geithner admits that Sandy Weill spoke with him about becoming Citigroup’s CEO after Prince resigned following multi-billion dollar losses in late 2007. Were Geithner’s many trips to Citigroup actually job auditions? Geithner turned down the job offer and went on to become U.S. Treasury Secretary in 2009 where his advocacy for Citigroup’s survival played a far more important role than he could have as its CEO.

The other troubling possibility is that Geithner did not take other staff with him from the New York Fed because he was strategizing with Citigroup on how to resolve their massive financial problems. Indeed, on April 7, 2008, Geithner’s appointment calendar shows that a meeting was convened at the New York Fed and given the title: “Citigroup Strategy, Structure & Personnel Issues.” The meeting was attended by Geithner, Citigroup CEO Vikram Pandit, Citigroup Vice Chairman Lewis Kaden, and several staffers at the New York Fed. The meeting was held after hours, from 5:30 to 6:30 p.m.

Strategizing on a company’s structure and personnel issues does not sound like the job of a regulator but the job of a competent CEO and Board of Directors.

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