Sunday, June 07, 2009

CBS "60 Minutes": When FDIC walks in the door on Friday afternoon

Scott Pelley of CBS 60 Minutes took us inside the seizure of a bank by the FDIC, the Federal Deposit Insurance Corporation, the Heritage Bank near Chicago, in the May 31, 2009 broadcast. FDIC officials and employees check into a nearby hotel under false names, and walk in the door a 6 PM on Friday Feb. 27 and tell the employees that as of 6:01 PM they are FDIC employees, but that their benefits and vacation remain intact. The broadcast shows a private Internet auction in Dallas a few days before where a company named MBFinancial agrees to buy the bank.

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Pelley interviews FDIC chairwoman Sheila Bair, who says that no one has lost a penny of FDIC insured money, which is now at set limit of $250000. In this case, since the Heritage Bank was bought, all the deposits were preserved.

The text story is “Your Bank Has Failed: What Happens Next?: 60 Minutes Gets A Rare Look At How The FDIC Takes Over Banks And Reassures Depositors”, link here.

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