In the file of "Things We Already Knew," there is a new tab about Henry Paulson forcing big banks to take TARP funds at a meeting on October 13, 2008. According to Reuters, the public interest group Judicial Watch has gotten hold of the documents that have Paulson's "talking points" from the gathering.
At one point during the meeting, Paulson, who was at the time Secretary of the Treasury, held a "gun" to the bankers' heads. "We don't believe it is tenable to opt out because doing so would leave you vulnerable and exposed. If a capital infusion is not appealing, you should be aware your regulator will require it in any circumstance."
Did Paulson have the legal right to do this? It doesn't much matter. He probably did not bring copies of bank regulations to the meeting.
Douglas A. McIntyre is an editor at 24/7 Wall St.