Judge Andrew Napolitano:
The emails obtained by Cong. Darryl Issa (R-CA), which I have seen and reviewed, reveal a conspiracy among lawyers for AIG and the NY Fed to conceal from the SEC the nature and extent of AIG’s true indebtedness and its stated intention to pay certain vendors (among them the publicly-hated Goldman Sachs) one hundred cents on the dollar. While I have not heard any defense of this nefarious informal agreement, it does raise serious concerns. These emails are now to be the subject of scheduled hearings in the House and now requested hearings in the Senate.
It is a federal crime to falsify documents involved in a loan from a federally-insured bank, unless the matter was immaterial to the loan. Thus, if one intentionally gave a false address on an application to purchase a $1000 savings bond, one could be prosecuted; but if one inadvertently left off a zip code, a prosecution would be highly unlikely. This was a case involving a revolving movement of nearly $185 billions between and among the Treasury, the NY Fed, JPMorgan Chase, and AIG. Leaving out the name, amount, and intended payment to a creditor of $13 billions would surely satisfy the material misrepresentation requirement of the statute that criminalizes such omissions. The fact that “the government told me to do it” is not only not a defense, but may (and should) implicate whoever in the government counseled in favor of such omissions.
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