Sen. Inouye steers bailout to bank he's invested in
The Washington Post reports today on the how the staff of Sen. Daniel Inouye (D-Hawaii) tried to get federal regulators to provide bailout funds for a bank where the senator has invested the bulk of his personal wealth.
After the intervention, regulators at the Federal Deposit Insurance Corp. reversed their earlier decision not to provide bailout funds because the institution, Central Pacific Financial, did not qualify. The bank received a $135 million injection of federal funds as part of the Troubled Asset Relief Program.
Having been granted an extension, Inouye has not yet filed his 2009 personal financial disclosure covering last year. But his 2008 disclosure shows that at at the end of 2007 he and his wife owned between $350,000 and $700,000 worth of Central Pacific Financial stock.
According to the Post, 33 senators own stock in banks that received bailout funds, but no other senator or staff is known to have directly intervened in the bailout process to assist a bank they were invested in.
Inouye gave a statement to the Post confirming an aide called the FDIC to ask about Central Pacific's application for bailout funds, but he did not address whether he knew of the call. The Post says even direct involvement by Inouye would not violate Senate rules.
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