GOP Rep. McHenry to probe: Where was Wachovia's bailout?

[unhappycamper]

GOP Rep. McHenry to probe: Where was Wachovia's bailout?
By Christina Rexrode | Charlotte Observer
Posted on Thursday, December 30, 2010

Republican Rep. Patrick McHenry is about to take on a new job watchdogging the government's bailout of the banking industry, and he's mapped out a few priorities.

Among them:

Straighten out a potential wave of cities defaulting on municipal bonds.

Re-examine the Dodd-Frank financial regulation overhaul.

And figure out why Charlotte-based Wachovia never got a bailout in fall 2008, when it nearly collapsed under the weight of bad loans and was sold to San Francisco-based Wells Fargo.


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on edit to add:

Wachovia accused of looking other way in Florida Ponzi scheme
By Nirvi Shah | Miami Herald
Posted on Thursday, December 30, 2010

MIAMI — As George Theodule lured hundreds of people to invest with him, using his heritage, a network of churches and his radio show as bait, the bank through which he operated his massive Ponzi scheme looked the other way, according to a lawsuit filed in federal court this month.

The suit, filed by Jonathan Perlman of Genovese Joblove & Battista in Miami, says that when Theodule opened an account at a Wachovia branch in 2008, the bank didn't take basic precautions to learn more about their new customer.

Theodule moved his accounts to Wachovia from a nearby Washington Mutual branch, both in Lake Worth. He told Wachovia that Washington Mutual wasn't "business friendly," according to the suit.

"Had Wachovia simply called WAMU, it would have, of course, learned that WAMU had determined that the transactions Theodule was conducting were inconsistent with any legitimate business," says the suit, which was filed against Wells Fargo. Wells Fargo purchased Wachovia in 2008.

Wachovia declined to comment on the Theodule case.



unhappycamper comment: Maybe Patrick can read up on Wachovia's business practices before he wastes taxpayer money.