Obama: Geithner to try to halt AIG bonuses
WASHINGTON, March 16 (UPI) -- U.S. President Barack Obama said Monday he asked the U.S. treasury secretary to "pursue every legal avenue" to block bonuses paid by American Insurance Group.
"In the last six months, AIG has received substantial sums from the U.S. Treasury," Obama said of insurance giant AIG's receiving nearly $170 billion in bailout funds. "I've asked Secretary (Tim) Geithner to use that leverage and pursue every legal avenue to block these bonuses and make the American taxpayers whole."
New York State Attorney General Andrew Cuomo also said he was investigating the matter. In a letter to Chief Executive Officer Edward Liddy, Cuomo requested the company release the names of individuals who received bonus checks.
"Covering up the details of these payments breeds further cynicism and distrust in our already shaken financial system," the letter said.
AIG has been roundly chastised since news stories emerged it was paying out $165 million in bonuses and compensation after receiving federal bailout funds. AIG said it was contractually obligated to dispense the funds.
AIG, Obama said, "is a corporation that finds itself in financial distress due to recklessness and greed."
Given the state of AIG's books, "it's hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay," he said.
What the situation "underscores is the need for overall financial regulatory reform," he said, "and for some form of resolution mechanism in dealing with troubled financial institutions, so we have greater authority to protect American taxpayers and our financial system in cases such as this."
Obama spoke about AIG as he and Geithner announced plans to try to unlock credit for small-business owners that include loan guarantees to lenders and suspending fees associated with business loans.
AIG, meanwhile, revealed the names of beneficiaries of its massive federal bailout, bowing to political pressure to do so. AIG said it paid French bank Societe Generale $4.1 billion and Deutsche Bank $2.6 billion, CNN reported.
High on the list were Goldman Sachs, Merrill Lynch, Morgan Stanley, Bank of America and Barclays.
Obama outlines tax relief, loan backing
WASHINGTON, March 16 (UPI) -- U.S. small business will get tax incentives and relief combined with efforts to thaw lending in a package outlined Monday by U.S. President Barack Obama.
Obama and U.S. Treasury Secretary Tim Geithner outlined elements of plans to take immediate action to help ensure that credit gets flowing again to entrepreneurs and business owners after meeting with a group of small-business owners, community bankers and lawmakers.
"Small businesses are the heart of the American economy," Obama said. "They're responsible for half of all private sector jobs and they created roughly 70 percent of all new jobs in the past decade."
Among the efforts to help open credit to small businesses, the Treasury Department will purchase securities backed by Small Business Association loans and will be prepared to buy new securities to ensure that community banks and credit unions have confidence in loaning money to local businesses.
Small-business owners applauded Geithner's announcement that the Internal Revenue Service will allow businesses to carry back operating losses to five years instead of two "to help increase your case flow and allow you to invest more in your operations."
The Treasury secretary also drew applause when he announced efforts to reduce and eventually eliminate capital gains taxes for small businesses capital and other tax incentives.
Geithner also said he wanted to send "a clear message" to banks.
Geithner said he was asking for new reporting requirements on small-business lending, including requiring the largest 21 banks receiving bailout funds to include small-business loans in their monthly reports. He also will asks bank regulators to call for quarterly reporting of small-business loans.
"We need every bank in the country to do everything in their power to provide the credit that small business needs to operate and to expand," he said, adding the reminder, "And given that role that many banks played in causing this crisis, you bear a special responsibility for helping America get out of it."
Pakistan suicide bomber kills at least 12
RAWALPINDI, Pakistan, March 16 (UPI) -- A suicide bomber detonated his explosives outside a hotel in Rawalpindi, Pakistan, Monday, killing at least a dozen people and wounding others, police said.
Police had confirmed 12 deaths and that 17 more people were injured, CNN reported. Other media reported higher and lower numbers.
The explosion occurred about 9:15 p.m. across from a bus terminal, the U.S. news network said.
PakTribune reported the blast occurred near Pir Wadhai Chowk at Ghousia Adda in Rawalpindi. Capital City Police Officer Rawalpindi Nasir Durrani confirmed it was a suicide attack, PakTribune said.
Talabani: Kurdish state 'just a dream'
ANKARA, Turkey, March 16 (UPI) -- An independent Kurdish state is "just a dream" and won't happen because Kurds see advantages to remaining in Iraq, Iraqi President Jalal Talabani says.
In an interview published Monday in the Turkish newspaper Sabah, Talabani said that it would not be realistic to believe that an independent Kurdish state could survive in a neighborhood that includes Turkey, Iran and Syria, the Turkish newspaper Hurriyet reported Monday.
"I tell my Turkish brothers not to fear that Kurds will declare independence," Talabani, himself a Kurd, said in the interview. "It is an advantage for Kurds to stay within the borders of Iraq in terms of their economic, cultural, social and political interests."
He added that uniting Kurds scattered throughout Iraq, Turkey and Iran, within one Kurdish state is "just a dream in poems."
Two arrests made in Brit cop killing
CRAIGAVON, Northern Ireland, March 16 (UPI) -- Two suspects were arrested Monday in last week's shooting death of a police officer in Northern Ireland, police said.
The men, ages 31 and 27, were taken into custody in the Craigavon area, The Times Online reported. Police said five other people, including a woman, were being questioned.
Police officer Stephen Carroll, 48, was shot in the back of the head last week while answering a call for assistance from a resident. A splinter group of the Irish Republican Army calling itself Continuity IRA, has claimed responsibility.
Four other suspects were being held in the slayings of two British soldiers and the wounding of four other men in Antrim in an attack two days prior to the shooting of Carroll. Another IRA splinter group, called the Real IRA, took responsibility for those killings.