The controversial acquisition of Bear Stearns by rival JP Morgan Chase, aided by billions
of dollars of government credit, is about to become one of the most scrutinized deals in Wall Street history. Two separate Senate investigations will soon be under way, one by the Banking Committee and another by the Finance Committee, reports the New York Times.
The tone of the investigations already threatens to be testy. The Finance Committee chair vowed his panel will probe “just how the government decided to front $30 billion in taxpayer dollars for the Bear Stearns deal." The chairman of the the Banking Committee has called on government architects of the deal to testify next week.