Little Timmy Geithner Is Above Ethics, Obviously

Or not obviously, depending on how you feel about the subject of ethics.

The Daily Beast reports on Timmy's latest ethical faux pas:

The bank, JPMorgan Chase, has just rehired one of Geithner’s oldest and dearest friends, Daniel Zelikow, as a top executive, only a year after the Treasury secretary moved out of his rent-free accommodations in Zelikow’s $3.5 million Washington townhouse.

Geithner lived with Zelikow’s family in the six-bedroom house, which is next door to the residence of the ambassador of Monaco and not far from the home of Secretary of State Hillary Clinton, during most of his first eight months running the Treasury Department. At that time, Geithner was overseeing the bailout of several huge Wall Street banks, including JPMorgan, which received $25 billion in federal rescue funds from the TARP program.

Zelikow, a friend of Geithner’s since they were classmates at Dartmouth College in the early 1980s, begins work this month running JPMorgan’s new 12-member International Public Sector Group, which will develop foreign governments as clients.

Spokesmen for the Treasury Department and JPMorgan would not comment for The Daily Beast on how Zelikow’s return to the megabank might affect the Treasury secretary’s dealings with JPMorgan.

What, Geithner couldn't use his family's ties to find him a free place to squat in DC that wouldn't make him look like a complete unethical idiot?

As The Daily Beast points out, what Geithner did is not necessarily wrong or unethical in the technical sense of the word since he got approval from the Treasury Department (natch) beforehand and JP Morgan had paid back bailout money Geithner was supposed to have his eye on before his buddy Zelikow was rehired. But for a man who is disliked by the populace and already a few strikes down for his tax troubles and previously questioned ethical fortitude, you'd think the guy would get smart and realize every move is under scrutiny. Of course he is the worst sort of narcissist and believes he can do no wrong and if he does the sheeple are too stupid to notice.

Can someone please fire this prick already?

Jr Deputy Accountant

Some say he’s half man half fish, others say he’s more of a seventy/thirty split. Either way he’s a fishy bastard.


elf2006real said...

Fire Skull and Bones?

(OK Princeton..but)

It may be that the finally awake American people will in Nov 2010 and 2012...

But I'm not sure it will be as easy as elections.

Michael said...

couldn't agree more but could someone fire the prick that hired him you know Mr. Change I mean fraud

Anonymous said...

As usual, these investigative reporters need to do a better job investigating.

The Federal ethics rules prohibit an employee, including a political official such as Mr. Geithner from accepting gift from a prohibited source (i.e., someone who does or seeks to do business with the agency). Nonetheless, there are a number of exceptions to this rule, including one that would allow an employee to accept a gift from a personal friend. It appears that Mr. Zelikow would fall in that category. After all, I do not think anyone would be troubled if Mr. Geithner's mother gave him a $2000 watch for his birthday even if she happened to be a CEO of a major US bank. Nonetheless, accepting almost a year's worth of rent in a $3.5 million home from a investment banker, who happens to be a friend, raises significant perception concerns that would warrant any reasonable person with a conscience to refrain from accepting what is otherwise a legally acceptable gift. It seems Mr. Geithner and his lawyers did not see it that way.

What is missing here is any evaluation of appearance concerns. Under the ethics regulations an employee should not participate, unless authorized, in a specific party matter (i.e., matters that would affect the legal rights of specific non-Federal parties) where he knows that such participation would likely have a direct and predictable effect on the financial interest of a member of his household and where the employee determines that the circumstances would cause a reasonable person with knowledge of the relevant facts to question his impartiality in the matter. In this case, it appears that Mr. Geithner serves on the Board of Governors for the IDB Bank, the very bank in which his friend and housemate worked. As a high level official of the bank, one can presume that Zelikow had some sort of incentive bonus and Mr. Geithner's participation in such matters may affect the financial interests of Mr. Zelikow.

The journalist or someone should ask: Did the Treasury ethics officials authorize Mr. Geithner to participate on the IDB Board while his buddy was working there? If so, what factors did they consider. It is not clear if they even evaluated this issue.


He did run it by Treasury's ethics department, supposedly, and they gave it the OK.

Kind of like the Fed ethics folks gave Stephen Friedman the OK to buy bunch of Goldman shares while he sat on the NY Fed Board.

Surely you know how this goes.

Anonymous said...

Jr Dept Accountant,
The ethics officials at Treasury, at least from the report, merely determined that the acceptance of free lunch fell under one of the gift exceptions under the ethics rules. See 5 CFR 2635.204(b). There is a separate analysis under the appearance standard regarding recusal requirements for certain non-Federal relationships, including a person with whom you live in the same house. See 5 CFR 2635.502(a).

All I am saying is that the journalist did not explore that issue. Perhaps, the Treasury folks did not as well. Did the reporter ask if Mr. Geithner participated in any specific matters involving IDB and if so what factors were considered to authorize such participation, if an authorization was issued.