BY: Derrick Broze
A lawsuit dealing with the 2008 bailout of insurance corporation American International Group (AIG) may result in Ben Bernanke becoming the first sitting Federal Reserve chairman to testify under oath in a case of this kind. The lawsuit was filed by Starr International, representing itself and AIG stock holders, alleging that the government “exploited AIG’s vulnerable financial position by becoming a controlling lender and controlling shareholder of AIG.” Judge Thomas Wheeler of the U.S. Court of Federal Claims is calling upon Federal Reserve chairman Ben Bernanke to testify regarding his knowledge of the deal.
Starr claims the government, specifically the Federal Reserve, used AIG and its assets to provide a “backdoor bailout” of financial institutions such as Deutsche Bank, and Goldman Sachs, as well as seizing AIG’s property, including 562,868,096 shares of its common stock. The Department of Justice has stated that Bernanke cannot be forced to testify because high-ranking U.S. government officials are protected from being dragged into “time consuming civil lititgation”. Critics of Bernanke speculate that the soon to retire Fed chairman is attempting to maintain a level of secrecy surrounding specific actions by the Fed.
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