- The Washington Times - Tuesday, July 29, 2014

A House hearing on Tuesday doled out more pain for the troubled U.S. Export-Import Bank, which faces a funding cut-off Sept. 30 if it is not reauthorized by Congress.

The bank, which provides insurance for US export transactions and sometimes provides loans to foreign buyers of U.S. goods, has become a target for some House Republicans, who used the hearing to highlight new reports of potential fraud by Ex-Im bank employees.

Johnny Gutierrez, a former bank employee subpoenaed as a witness for the hearing, repeatedly pleased the Fifth Amendment when questioned by Rep. Jim Jordan, the Ohio Republican who chaired the subcommittee hearing.

Mr. Gutierrez, and three unnamed former Ex-Im employees are currently under investigation for allegedly accepting gifts from companies who had dealings with the bank.

Ex-Im Bank President Fred Hochberg defended the agency’s handling of the corruption probes, but declined to comment on the specifics of the case.

“I am choosing not to interfere with a criminal investigation,” Mr. Hochberg said.

Mr. Jordan pushed Mr. Hochberg extensively during the hearing for details on the individuals and bank deals being investigated.

“There’s nothing in the law to prevent Mr. Hochberg from telling us what he knows,” Mr.. Jordan said.

Democrats contended that the hearing was meant to build opposition to reauthorizing the bank, which many conservative and some liberal critics have condemned as “crony capitalism” channeling taxpayer dollars to big businesses. The Obama administration, backed by major business groups such as the National Association of Manufacturers, has actively lobbied Congress to reauthorize the bank by the Sept. 30 deadline.

“[This is a] rush to judgement intended to tarnish the reputation of the bank and its employees in an attempt unduly to influence a vote on the bank’s reauthorization,” Pennsylvania Rep. Matt Cartwright, the subcommittee’s ranking Democrat, said.

The Inspector General of the bank, Michael McCarthy, said in a letter addressed to Mr. Cartwright on Monday that the four individuals being investigated did not represent a systemic problem within the bank.

“At this time, we have not developed evidence of widespread employee misconduct or systemic employee involvement in fraud schemes at the bank,” McCarthy wrote.

The bank currently offers $140 billion in loans and guarantees, and according to its own accounting, has returned some $2 billion to the Treasury Department over the past two years. If the bank is not reauthorized by the September date, it will continue to meet its current obligations, but will not be able to make any new loans or guarantees after that date.


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