Democrats Rip Into Hard-Partying Bailed-Out Bank

Tuesday 24 February 2009

»

by: Silla Brush, The Hill

Congress wants Northern Trust Bank to return part of the more than $1.5 billion in federal bailout money given to them after it was revealed that they paid for lavish parties during the Northern Trust Open golf tournament. (Photo: Allen J. Schaben / Los Angeles Times)

Eighteen Democrats on the House Financial Services Committee are lambasting Northern Trust bank, a recipient of more than $1.5 billion in federal bailout money, for spending money on a series of lavish events and perks.

Lawmakers want the bank to return money after gossip site TMZ captured photos and video of events last week that coincided with the PGA Northern Trust Open at the Riviera Country Club in Los Angeles. The expenditures included renting out a hangar at the Santa Monica Airport and hiring the band Earth, Wind & Fire to perform, plus renting out the House of Blues and paying Sheryl Crow to perform. The band Chicago, which played at another Northern Trust event at the Ritz, told TMZ that the bank paid them $100,000 for the show.

"We are dismayed and angered," the lawmakers wrote in a letter to Frederick Waddell, CEO of the Illinois-based bank. The lawmakers included committee Chairman Barney Frank (Mass.), Rep. Carolyn Maloney (N.Y.), Rep. Brad Miller (N.C.) and others.

The lawmakers cited the reports of the bank's sponsorship of the "Northern Trust tournament at the Riviera Country Club," as well as reports that the bank hosted clients and employees at the Beverly Wilshire and Ritz-Carlton hotels and gave away Tiffany souvenirs.

"If this is accurate," the lawmakers wrote, "we are demanding you take corrective action.

"We insist that you immediately return to the federal government the equivalent of what Northern Trust frittered away on these lavish events," the lawmakers wrote. "Federal taxpayers should not and will not stand for such abuses, and we will insist that any future Treasury support for Northern Trust be conditioned on a thorough reform of your company's policies and practices."