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Fed must reveal data on loans to firms, court says (Washington Post)

Posted: 19 Mar 2010 03:47 PM PDT

A panel of the 2nd U.S. Circuit Court of Appeals in Manhattan said in two separate opinions that such information isn't automatically exempt from requests under the Freedom of Information Act.

News Corp.'s Fox News Network LLC and Bloomberg L.P. sued separately for details about loans that commercial banks and Wall Street firms received and the collateral they put up. Other news agencies including The Associated Press filed briefs with the appellate court in their support.

The Fed argued that if it identified banks that drew emergency loans, it could cause a run on those institutions, undermine the loan programs and potentially hurt the economy, and lower-court judges were split on the issue.

The Federal Reserve said it's studying Friday's ruling.

"We are reviewing the decision and considering our options for reconsideration or appeal," said Fed spokeswoman Michelle Smith.

Until a final ruling, the Fed is not compelled to turn over any documents.

Sen. Byron Dorgan, who has pressed the Fed to release details about the loan programs, urged Chairman Ben Bernanke on Friday to "immediately" identify the firms that drew emergency loans and the amounts.

Failing to do so after the court rulings "would be a pretty arrogant thing for the Fed to do," Dorgan said in an interview with The Associated Press.

In the Fox case, a three-judge panel concluded Friday that the documents should be available for review by news organizations and the public. A lower-court judge had agreed with the Fed that the documents belonged to the Federal Reserve banks and were off limits to the public under the Freedom of Information Act.

Kevin Magee, executive vice president of Fox Business Network, said: "We are pleased that this information is finally, and rightfully, going to be made available to the American public."

In the Bloomberg case, the court rejected the Fed's argument that identifying the banks and providing other information would harm them and discourage other distressed banks from seeking the Fed's help. The court said the disclosure requirements under FOIA are set by Congress, not the court.

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