Paulson Called Goldman Exec Before Getting Ethics Waiver

Memo to Congress: Probe Paulson's financial records and his conversation with Goldman exec.

Hat tip to TPM for Monday's story:

Earlier today we told you about the near-constant phone contact between then-Treasury Secretary Henry Paulson and his successor as Goldman Sachs CEO, Lloyd Blankfein, during the height of the financial crisis last September.

Now, we've obtained from the Treasury Department Paulson's ethics agreement, in which he pledged not to participate in matters involving Goldman Sachs, and the waiver to that agreement granted by White House counsel Fred Fielding. You can read the agreement here and the waiver here.

In Paulson's ethics agreement, written after President Bush plucked him from Goldman to be Treasury Secretary, all but two of eight pages mention Goldman. He concludes it by saying "these steps will ensure that I avoid even the appearance of a conflict of interest."

Paulson pledged: "As a prudential matter, I will not participate in any particular matter involving specific parties in which The Goldman Sachs Group, Inc. ("Goldman Sachs") is or represents a party for the duration of my tenure as Secretary of the Treasury, unless my participation is in accordance with 5 CFR 2635.502(d)."

(That section of the federal code allows for exemptions to be granted under certain circumstances.)

The ethics waiver of September 17, 2008, signed by White House counsel Fred Fielding, allowed Paulson to participate in matters relating to Goldman. Fielding concludes -- "prudential matters" apparently aside -- that Paulson's interest in the Goldman pension plan "is not so substantial as to be likely to affect the integrity of your services to the Government."

Paulson pledged in his ethics agreement: "I will not participate in any particular matter that directly and predictably affects Goldman Sachs' ability or willingness to pay its obligations under the Pension Plan to me, unless I first obtain a waiver or a regulatory exemption applies."

While selling his stock in Goldman, Paulson kept his Goldman pension benefits when he became Treasury Secretary.

The Times reported that Paulson "specifically said that he would avoid any substantive interaction with Goldman executives for his entire term unless he first obtained an ethics waiver," but it's not clear when or where this promise was made.

And this from TPM:

The Times describes the tick-tock of the contacts, based on Paulson's calendar, obtained through the Freedom Of Information Act:

On the morning of Sept. 16, 2008, the day the A.I.G. rescue was announced, Mr. Paulson's calendars show that he took a call from Mr. Blankfein at 9:40 a.m. Mr. Paulson received the ethics waiver regarding contacts with Goldman between 2:30 and 3 the next afternoon. According to his calendar, he called Mr. Blankfein five times that day. The first call was placed at 9:10 a.m.; the second at 12:15 p.m.; and there were two more calls later that day. That evening, after taking a call from President Bush, Mr. Paulson called Mr. Blankfein again.

When the Treasury secretary reached his office the next day, on Sept. 18, his first call, at 6:55 a.m., went to Mr. Blankfein. That was followed by a call from Mr. Blankfein.