Geithner, Bernanke, Schapiro Met Panel Probing Financial Crisis

Nov. 17 (Bloomberg) -- The U.S. commission investigating what caused the financial crisis met Treasury Secretary Timothy Geithner and Federal Reserve Chairman Ben S. Bernanke as it scrutinizes regulatory failures that contributed to losses at Wall Street banks.

Geithner and Bernanke met the commission privately in Washington today, said panel spokeswoman Susan Baltake. U.S. Securities and Exchange Commission Chairman Mary Schapiro met panel members yesterday.

Lawmakers have criticized the Fed for not doing enough to stop lax mortgage lending and for its lack of transparency in pumping money into financial companies that faced collapse. To meet a December 2010 deadline for reporting findings to Congress, the Financial Crisis Inquiry Commission needs the Fed, Treasury and SEC to be forthcoming in turning over documents, said Michael Bopp, a former Senate investigator.

“You don’t want an adversarial tone off the bat,” said Bopp, now a partner at Gibson, Dunn & Crutcher in Washington. “They want a cooperative relationship with the agencies, so it makes sense to sit down with them at the outset.”

The commission convened the meetings as part of its “ongoing work” and is holding discussions with experts in finance and economics, Baltake said.

The panel, with six members appointed by congressional Democrats and four by Republicans, said today that it hired five staff members.

Five Staff Hires

They include Bart Dzivi, a former counsel to the Senate Banking Committee; Martin Biegelman, a Microsoft Corp. executive who monitors corruption for the software company; Bradley Bondi, an SEC lawyer; Thomas Krebs, a former Alabama securities regulator; and Dixie Noonan, an attorney who has worked on financial investigations.

Commission members were announced in July, with House Speaker Nancy Pelosi promising a “thorough, systemic and non- partisan examination of the failures in both government and financial markets.”

The panel, led by former California Treasurer Philip Angelides, has held just one public hearing since then. Before today, it had announced few hires.

The slow start raised questions about the commission’s ability to meet the 2010 deadline and whether lawmakers really want to get to the bottom of a crisis that caused $1.67 trillion of losses at financial companies worldwide, said Lynn Turner, a former SEC chief accountant.

The meetings with Geithner, Bernanke and Schapiro show the panel is starting to make progress and that it may soon seek information from financial firms, Bopp said. Companies that have received government bailouts include Citigroup Inc., Bank of America Corp., Fannie Mae and Freddie Mac.

To contact the reporters on this story: Jesse Westbrook in Washington at jwestbrook1@bloomberg.net; Ian Katz in Washington at ikatz2@bloomberg.net.

To contact the reporter on this story: Alec McCabe in New York at amccabe@bloomberg.net