Fed loses Bloomberg lawsuit, required to name banks with emergency loans
Washington, DC, United States (AHN) – The U.S. Supreme Court ruled Monday in favor of Bloomberg in a lawsuit that sought the publication of details of loans made by the Federal Reserve to American banks during the 2008 financial crisis.
Bloomberg, the parent company of Bloomberg News, sought details of the discount window data under the Freedom of Information Act, but the Fed thumbed down the request, prompting Bloomberg to file the lawsuit. A trial court favored Bloomberg in 2009, but the Fed appealed. A federal appeals court confirmed the lower court ruling.
While the Fed bowed to the court decision, the Clearing House Association – which represents 10 of the largest U.S. banks – filed an appeal with the Supreme Court. The association wanted to continue enjoying the confidentiality of such information that the Fed provided banks for almost 100 years.
Following the Supreme Court’s decision, the Fed said it would soon release details of the discount window loan. Last year Congress mandated the Fed to publish similar information on its other lending programs.
The banks tried to block the publication because it would bring back public attention to the financial institutions’ weaknesses while the banks are trying to project a renewed profitability image.
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