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Geithner called to testify about crisis

Associated Press / April 30, 2010

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WASHINGTON — A panel investigating the roots of the financial crisis is calling Treasury Secretary Timothy Geithner to testify about financial companies that escaped regulation.

The Financial Crisis Inquiry Commission will hear from Geithner at a hearing next Thursday about the so-called shadow banking system, the panel said yesterday. Other witnesses include former Treasury Secretary Henry Paulson and former Bear Stearns chief executives James Cayne and Alan Schwartz.

Bear Stearns was sold to JPMorgan Chase & Co. in 2008 after two hedge funds it owned suffered massive losses on subprime mortgage investments. Geithner helped arrange the sale as the president of the Federal Reserve Bank of New York.

The panel known as the FCIC also will hear from former Securities and Exchange Commission chairmen Christopher Cox and William Donaldson, SEC inspector general David Kotz, and executives from GE Capital, asset manager PIMCO, and State Street Corp.

The bipartisan panel used its subpoena power for the first time last week to obtain documents from credit rating agency Moody’s Corp. Panel chairman Phil Angelides said Moody’s refused to provide the documents voluntarily.

The FCIC already has taken testimony from the chief executives of big banks including JPMorgan, Goldman Sachs Group, and Bank of America Corp.