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Jack Lew, Obama's Treasury Nominee, Faces Questions About Citigroup Bonuses

Feb 13, 2013

Jack Lew, who President Obama has nominated as Treasury Secretary, was grilled over his time at Citigroup today during his confirmation hearing.

At issue, reports Fox News, was a nearly $1 million bonus he accepted just as the bank was getting bailed out by the federal government.

Fox adds:

"Republican lawmakers pointedly asked him how he could accept a $940,000 bonus from Citigroup in early 2009. At the time, Citigroup had received a $45 billion bailout and was about to get an even bigger federal guarantee.

"Sen. Chuck Grassley, R-Iowa, questioned why Lew thought it to be 'morally acceptable' to take the money from an 'insolvent' company receiving federal aid.

"Lew said he was compensated in a manner consistent with how other employees were paid."

According to USA Today, Lew also pointed out that he was employed in the private sector at the time and that he "reported all the income I earned and paid all the taxes due."

CBS News reports that Sen. Orrin Hatch, a Republican from Utah, suggested his involvement with Citibank would pose a conflict when it was time to enforce new rules that prohibit banks from making some risky investments.

"You would be, in effect, saying to financial firms, 'Do as I say, not as I did,' " Hatch said.

To which Lew replied: "The work I did in 2008 was running the business of the business in a year when the financial products of the firm were not doing well. I was not in the business of making investment decisions. I was certainly aware of things that were going on, but I wasn't designing (investments) and I wasn't opining on them."

US News takes the view that the Lew hearing in front of the Senate Finance Committee was less confrontational and problematic than the hearings for CIA chief nominee John Brennan and defense secretary nominee Chuck Hagel.

Compared to those hearings, US News reports, it was a "smooth ride" for Lew.

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