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Frank: Bailout Money Wasted on Parties

By    |   Tuesday, 24 Feb 2009 03:37 PM

Barney Frank is hopping mad at Chicago bank Northern Trust after learning from a Web site that the bank — which got $1.6 billion in taxpayer bailout funds — blew millions on parties following a golf event that featured top musical acts, ritzy hotel stays, and blow-out parties.

Frank told gossip site TMZ, which filmed the parties, that he will be demanding that Northern Trust give back the money it spent on the parties in Los Angeles last week.

Frank, a Democrat, is chairman of the House Committee on Financial Services.

Frank also told the site he would ask Northern Trust to return the entire $1.6 billion in bailout cash, since the bank had not asked for the money in the first place. Former Treasury Secretary Henry Paulson sent money to some banks whether they asked for the cash or not.

Frank called the bank’s golf events an "ego thing" and said that it should be lending out the money it has on hand, not spending it on its clients and employees.

According to TMZ, Northern Trust flew hundreds of them to L.A. and put many of them up at some of the fanciest hotels in the city including the Beverly Wilshire, the Loews Santa Monica Beach Hotel, the Ritz Carlton in Marina Del Rey, and Casa Del Mar in Santa Monica.

During the several-day event, groups including Chicago, Earth, Wind & Fire, and Sheryl Crow performed for the guests and some were given gifts, including items from jeweler Tiffany & Co.

A Northern Trust spokesman told TMZ that the money spent came from “operating expenses” and not from the bailout funding.

The bank later told the Chicago Tribune that the event was part of a long-standing commitment.

Northern Trust signed a five-year commitment to sponsor the Northern Trust Open in the fall of 2007, a year before the bailout, a Northern Trust spokesman told the newspaper.

"The reason Northern Trust sponsors the Open is it's an integral part of its marketing program. It's about client relationships and showing appreciation for clients," the unnamed spokesman said.

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Barney Frank is hopping mad at Chicago bank Northern Trust after learning from a Web site that the bank — which got $1.6 billion in taxpayer bailout funds — blew millions on parties following a golf event that featured top musical acts, ritzy hotel stays, and blow-out...
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Tuesday, 24 Feb 2009 03:37 PM
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