Lawmakers threaten Ex-Im Bank subpoena in oversight rebuff

WASHINGTON Tue Aug 19, 2014 7:55pm EDT

Chairman of the House Financial Services Committee, Jeb Hensarling (R-TX) questions financial regulators about the effects of the Volcker Rule on employment in Washington on February 5, 2014.      REUTERS/Joshua Roberts

Chairman of the House Financial Services Committee, Jeb Hensarling (R-TX) questions financial regulators about the effects of the Volcker Rule on employment in Washington on February 5, 2014.

Credit: Reuters/Joshua Roberts

WASHINGTON (Reuters) - Top members of the House of Representatives Financial Services panel are threatening to subpoena the U.S. Export-Bank over the bank's refusal to make three employees available for questioning as Congress considers whether to renew the bank's charter.

Chairman Jeb Hensarling and Representative Patrick McHenry, who chairs an oversight subcommittee, also expressed sharply worded disapproval that the bank had heavily redacted meeting transcripts sought by lawmakers.

"The bank's inadequate and unacceptable response deprives the committee of information necessary to critically examine the bank's day-to-day operations and assess proposed legislation submitted by the bank in connection with its request for reauthorization," Hensarling and McHenry wrote in a letter made public Tuesday.

Another panel, the House Oversight Committee, had also requested documents on allegations that bank officials were suspended or removed as investigators looked into charges of improper gifts or kickbacks. Lawmakers on the Financial Services panel said they needed the information to evaluate the bank's request for reauthorization.

Bank President Fred Hochberg, an appointee of President Barack Obama, declined to make the three staff members available to the Financial Services committee, saying it is not common practice to do so and that lawmakers did not say what they wanted to discuss.

Hensarling and McHenry said that the bank's refusal to comply was surprising in light of the bank's reauthorization proposal and its hopes to expand its lending authority.

"The committee will not countenance the bank's failure to cooperate in a full and transparent manner with legitimate congressional oversight," they said.

The lawmakers said they would work with the Oversight panel, which is chaired by Darrell Issa, to compel the bank to make the individuals available, including through subpoenas if necessary. A spokesperson for Issa's committee said such measures were possible.

"All options are on the table to obtain information from the Ex-Im bank about their recent corruption scandals," Oversight Committee communications director Becca Glover Watkins said.

Ex-Im Bank provides loans, loan guarantees and credit insurance to help private companies export goods overseas. Its biggest beneficiaries are companies such as Boeing and Caterpillar, but smaller exporters also receive financing.

The bank's charter is set to expire at the end of September. Many conservatives in Congress would like to end the bank, which they view as an unnecessary federal agency that benefits big firms while putting taxpayers at risk should borrowers default. Opponents say its services should be provided by the private sector.

The issue has pitted moderate Republicans and business groups such as the Chamber of Commerce against more conservative lawmakers who see eliminating the bank as an important statement of principle. The standoff poses another challenge for the Republican leadership of House Speaker John Boehner, who has been reluctant to cross the most conservative members of his caucus.

Ex-Im Bank supporters, who include most Democrats and Obama, argue that the bank's financial backing is critical for U.S. businesses and that letting its charter expire would cost American jobs.

(Reporting By Mark Felsenthal and Susan Cornwell; Editing by Ken Wills)

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