Barofsky says the question of whether the New York Fed engaged in a coverup will result in some sort of action.
“We’re either going to have criminal or civil charges against individuals or we’re going to have a report,” Barofsky says. “This is too important for us not to share our findings.”
He won’t say whether the investigation is targeting Geithner personally.
I contacted Barofsky's office yesterday morning to ask about a timeline for charges, and they had no comment. When I asked if something would happen in 2010, I was told "yes."
It's not out of the question. Barofsky has a history of fearless prosecution. He was the target of a kidnapping/assassination attempt by Colombian druglords in 2005 -- detailed in the Bloomberg story. So if he's got a case against either, he will probably file. That said, insider trading charges against Friedman would normally be an SEC investigation. Maybe that's why he said the following to Bloomberg:
“I’ve been in contact with the SEC,” he told the committee. “We’re going to coordinate with them, but we’re going to lead the charge. We’re going to review these transactions.”
Don't forget that Barofsky has criticized Geithner by name in multiple SIGTARP reports as well as in Congressional testimony regarding his handling of the AIG bailout while at the FRBNY. So again, it would not shock me to see charges filed.
The Bloomberg story is highly recommended reading. It's full of great quotes and anecdotes not mentioned here. Such as the following:
A Democrat named by a Republican president, Barofsky says missteps by both the George W. Bush and Barack Obama administrations are to blame for TARP’s failures.
“There’s a reason there are Tea Partiers out there, and when you look at it, anger at the bailout is one of the first things they talk about,” says Barofsky, referring to the anti- Obama political movement. “This Treasury Department and the previous Treasury Department bear some of the responsibility for not being straightforward with the American people.”
Barofsky criticized Geithner’s predecessor, Paulson, in an October 2009 report, saying Paulson publicly described the initial nine TARP bank recipients as healthy when he knew that at least one of them risked failure.
Barofsky is wise to criticize both parties and he understands the public's anger regarding the Wall Street bailout. And he even takes a shot at Henry Paulson. It's hard not to like the guy. Go read the profile at Bloomberg.