Picks of the Week: Wall Street, Counterfeit Chinese Parts and PAC Money
In a regular feature of Post Investigations, our editors have combed through the in-depth and investigative reports from news outlets across the nation and selected the notable projects of the week.
Get the complete list (in no particular order) after the jump.
The Hourlong Meeting That Changed Wall Street
A 55-minute meeting held on April 28, 2004, between the five members of the Securities and Exchange Commission and the country's biggest investment banks fundamentally changed how the banking industry works and, in part, led to the Wall Street mortgage meltdown four years later, The New York Times' Stephen Labaton found.
The meeting, held in a basement hearing room, was unattended by any major media outlets. Its result -- the unleashing of investment banks from an old rule that limited the amount of debt they could take on -- largely went unnoticed.
But the loosening of the nation's capital rules allowed the firms to borrow more. In return, the SEC was given access to the the "firms' own computer models for determining the riskiness of investments, essentially outsourcing the job of monitoring risk to the banks themselves."
But the government regulators didn't take advantage of their new responsibilities, The Times reports.
"The agency's failure to follow through on those decisions also explains why Washington regulators did not see what was coming," Labaton writes.
Countefeit Chinese Computer Parts Leave U.S. Armed Forces in Trouble
The discovery of counterfeit Chinese computer parts in American warplanes, ships and communication networks have left the Pentagon vulnerable to accidents and espionage, BusinessWeek reports.
The news magazine pointed to two incidents where counterfeit computer chips were shipped and used in American military products, including a F-15 fighter jet based at Robins Air Force Base in Warner Robins, Ga.
"Potentially more alarming than either of the two aircraft episodes are hundreds of counterfeit routers made in China and sold to the Army, Navy, Air Force, and Marines over the past four years. These fakes could facilitate foreign espionage, as well as cause accidents," BusinessWeek's Brian Grow, Chi-Chu Tschang, Cliff Edwards and Brian Burnsed found.
Wash. Times: Pelosi Using Campaign Money For Husband's Investments
House Speaker Nancy Pelosi (D-Calif.) took nearly $100,000 from her political action committee and used it to fund her husband's real estate and investment firm over the past decade, a practice which Pelosi herself pledged to ban last year, The Washington Times' Jennifer Harberkorn reports.
The Times reported that Pelosi's husband, Paul F. Pelosi, and his firm, Financial Leasing Services Inc. (FLS), received $99,000 in rent, utilities and accounting fees from the speaker's "PAC to the Future" over nine years.
Nancy Pelosi's office called the payments perfectly legal and said the money was paid for her husband's work for the committee.
By Derek Kravitz |
October 3, 2008; 4:37 PM ET
Previous: How a Missouri Feud Ousted a U.S. Attorney | Next: The Fight for Wachovia, McCain's Record, GOP Questions Obama Donations
Please email us to report offensive comments.