WASHINGTON—A U.S. House panel issued a subpoena for Federal Reserve Bank of New York documents related to American International Group Inc., as the political pressure surrounding one of the more controversial events of the financial crisis continued to grow.
Rep. Edolphus Towns (D., N.Y.), who chairs the House Committee on Oversight and Government Reform, said he was issuing a subpoena for documents that would "shed light on how and why taxpayer dollars were used for a backdoor bailout." At issue is the government-orchestrated decision to make whole AIG's counterparties on some $62 billion in bets on soured mortgage securities.
"We will work with the committee to provide relevant information as appropriate," said a spokeswoman for the New York Fed.
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