Supreme Court Lets Fed Bailout Records Release Stand

Published: Monday, 21 Mar 2011 | 10:39 AM ET

By: Reuters
CNBC

The Supreme Court let stand a ruling that the U.S. Federal Reserve must disclose details about its emergency lending programs to banks during the financial crisis in 2008.

A group representing major commercial banks had asked the high court to reverse a ruling by a federal appeals court that required disclosure of the lending records.

The justices rejected the banks' appeals. The Obama administration said the appeals should be denied.

It said the financial overhaul law adopted last year set new standards on releasing information about emergency lending programs and the law required the disclosure in December of much of the data at issue in the cases.

Bloomberg LP, the parent of Bloomberg News, and News Corp's [NWS 17.69] Fox News Network had sought the bailout details under the federal freedom of information law, which requires government agencies make certain documents public.

The two news organizations opposed the appeals, telling the Supreme Court the appeals court decision was correct on the merits and that further delay in releasing the remaining records would be unwarranted under the law.

The appeals court ordered the disclosure of borrowers' names, loan amounts and loan dates for transactions at the Fed's discount window and from its emergency lending facilities.

The Clearing House Association, representing the largest commercial banks that hold more than half of all U.S. deposits, appealed to the Supreme Court, arguing that the emergency lending data should be kept secret.

It said the appeals court ruling threatened numerous federal programs that depend on keeping commercial transactions confidential and could unjustifiably harm the reputation of banks that borrowed from the Fed's discount window.

Clearing House members include Bank of America [BAC 14.05], Bank of New York Mellon Corp [BK 29.07] , Citigroup [C 4.4325], JPMorgan Chase[JPM 45.63], UBS AG [UBS 18.57] and Wells Fargo [WFC 31.88].

The Supreme Court declined to hear the appeals without comment.

When the Supreme Court refuses to hear an appeal, it does not represent a ruling on the merits of the dispute.

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