A couple weeks ago, an op-ed in the New York Times called for the release of emails between AIG and their counter-parties, to establish a record of the company, which was at the heart of the financial meltdown on Wall Street. Today, the Washington Post partially abides, by printing an article including many inter-office AIG emails.
The probing e-mails came from every direction inside insurance giant American International Group during the summer and fall of 2007, all with the same underlying question:
Could Joe Cassano back up his assurances — to auditors, rating companies, colleagues and shareholders — that his Financial Products unit wasn’t in trouble? […]
While the e-mails offer the most revealing look yet at AIG’s inner struggles, they also underscore the main obstacle to federal prosecutors assessing individual culpability for the financial crisis. In a Wall Street culture defined by salesmanship and secrecy, divining the difference between optimism and deceit can be a legal morass — especially when it comes to convincing a jury that the line has been crossed.
This was essentially the impetus for the call by Eliot Spitzer and his colleagues, to put the emails online and make the investigation “open-source”. There are hundreds of thousands if not millions of these communications to sift through, and any of them could reveal a smoking gun – an effort to game the rating agencies, or intentionally deceive investors. This email from an AIG Financial Products staffer detailing questions from rating agencies and how to deal with them is sufficiently vague, but this one kind of isn’t, and there may be additional information out there. People do have a right to know how this company, owned 80% by the taxpayers at this point, conducted their business, especially because it had such a deleterious effect on the economy.
Here’s the sine qua non of what the Post was able to dig up:
“They are not budging and are acting irrational,” Tom Athan, a Financial Products executive, wrote on Aug. 2 to Forster after a tense conference call with Goldman employees. “I feel we need Joe [Cassano] to understand the situation 100% and let him decide how he wants to proceed.”
Athan added, “This isn’t what I signed up [for]. Where are the big trades, high fives and celebratory closing dinners you promised?”
Really, we need to see all the emails.