A lack of regulatory oversight has been suggested as a reason why a relatively small group of A.I.G. employees in London were able to hobble the entire company with risky bets. Ben Bernanke, the chairman of the Federal Reserve, testified this week that "there was no regulatory oversight because there was a gap in the system."
But Scott Polakoff, acting director of the Office of Thrift
Supervision, which was A.I.G.’s primary regulator, told lawmakers Thursday that his office knew about the A.I.G. unit in London and had oversight over its operations.
Jack Reed, a Rhode Island Democrat who sits on the Senate Banking Committee, drove this point home at Thursday’s hearing on the government’s A.I.G. bailout.
"The perception that this London operation was some rogue group that were unsupervised, that you had no access to it and that your regulatory authority didn’t reach there is not accurate," he said to Mr. Polakoff.
"Correct," Mr. Polakoff responded. "That would be a false statement."
As I pointed out, Greenspan wasn't in a position to make that call. However, his successor is a source of misinformation on this point.
From http://dealbook.blogs.nytimes.com/2009/03/05/as-regulator-wa...
A lack of regulatory oversight has been suggested as a reason why a relatively small group of A.I.G. employees in London were able to hobble the entire company with risky bets. Ben Bernanke, the chairman of the Federal Reserve, testified this week that "there was no regulatory oversight because there was a gap in the system."
But Scott Polakoff, acting director of the Office of Thrift Supervision, which was A.I.G.’s primary regulator, told lawmakers Thursday that his office knew about the A.I.G. unit in London and had oversight over its operations.
Jack Reed, a Rhode Island Democrat who sits on the Senate Banking Committee, drove this point home at Thursday’s hearing on the government’s A.I.G. bailout.
"The perception that this London operation was some rogue group that were unsupervised, that you had no access to it and that your regulatory authority didn’t reach there is not accurate," he said to Mr. Polakoff.
"Correct," Mr. Polakoff responded. "That would be a false statement."