Private Gains, Public Losses:
How Bob Corker used taxpayer money to protect his own investments.
Before we dive into the Corker/Luken/Wells Fargo fiasco, we need to update you our last posting: “The Big Short – Corker Style”.
In our last edition of the Corker Chronicles, we revealed how Corker bet against America by shorting the housing market, making millions in profit in the process. An alert reader reminded us that Corker’s perfidy wasn’t just shorting the market – he made sure his profits were secured by the taxpayers!
That’s right. When Bob invested in housing hedge funds using Pointer Management as a front, he was taking a risk. But Bob took steps from his perch as a U.S. Senator to minimize that risk. How? Well it seems that one of hedge funds Corker invested was partnered with a particular bank to ensure the payout of all the moola to Bob when the time came to cash in. The to-big-to-fail outfit that was essential for Corker to put money in his personal pocket was none other than AIG.
Sound familiar? It should. After the beheading of Lehman Brothers, Bear Stearns, et al, AIG was very much on the potential chopping block of financial institutions who were at risk of being dissolved and sold off. If that happened, investments such as Corker’s would take a direct and possibly fatal hit. If AIG went down, so would Bob.
Assuming he used information he was privy to from his position on the Senate Banking & Housing Committee to game the system, Corker had taken a major personal financial and ethical gamble in his investments with Pointer, but his exposure to what would happen to his personal bank account if AIG went down was a big, big problem. But never fear – along came the TARP legislation that would bail out AIG and keep it afloat long enough for Bob to run down to his bank and cash his checks. The legislation saving AIG’s sorry butt was unbelievably controversial, but Bob didn’t hesitate for a moment, nosiree. He voted FOR the AIG bailout helping insure that his personal investment would be safe from the financial crisis. And of course he did so without once letting the fine folks here in Tennessee or elsewhere know the extent or even the existence of his “insider” skullduggery and gross conflict of interest.
So it appears Corker was making a killing off of insider information while using taxpayers’ money to secure his investment.
We tell you all of this now, because it will give you a better appreciation of what we are about to tell you in Part 2.0.
Stay tuned. Our next edition will be up shortly.
We know you can’t wait…..