Citigroup Hires Mr. Inside
Few banks can use advice about navigating the federal government more than Citigroup, a company so hobbled by the crisis that it has essentially become a ward of the state, kept alive through multiple infusions of taxpayer funds.
Still, people inside and outside the bank say they were stunned when Richard D. Parsons, Citigroup’s chairman, enlisted the services last spring of Richard F. Hohlt, a longtime Washington insider with a history of aggressive advocacy for the banking industry.
Critics say that as a top lobbyist for the savings and loan industry in the 1980s, Mr. Hohlt blocked regulation of these institutions and played a pivotal role helping to prolong dubious industry practices that cost taxpayers $150 billion to clean up.
After that crisis passed, he faded from the public eye but continued advising clients, cementing his contacts in the news media and even surfacing as one among a handful of Washington insiders involved in the public outing of Valerie Wilson as a C.I.A. agent.
.. But two people briefed on Mr. Hohlt’s engagement with Citigroup, who requested anonymity because speaking publicly about the situation would jeopardize their jobs, say Mr. Hohlt was also hired to advise Mr. Parsons on ways to blunt the demands of the Federal Deposit Insurance Corporation, one of the bank’s primary regulators. The F.D.I.C. agreed to insure some $300 billion of Citigroup’s troubled assets in a loss-sharing arrangement last year and has been at loggerheads with the bank’s management over stewardship of the sprawling enterprise.
Mr. Hohlt said that it was a “fabrication” that he was hired to jockey with the F.D.I.C. “I’ve never contacted anybody at the F.D.I.C.,” he said.
.. Two former officials, a banking regulator and an under secretary of the Treasury, said they banned Mr. Hohlt from their offices. “He wasn’t my style,” said Richard T. Pratt, the Federal Home Loan Bank Board president in the early 1980s. “He was very aggressive I thought, kind of the caricature of a lobbyist.”