Grassley: Questions About Lew, NYU-Citibank Deal 'Distressing'

Obama Treasury Secretary nominee Jack Lew says he is not sure whether, as New York University Vice President of Operations, he approved a student-loan kickback scheme that made Citibank NYU’s primary private student loan lender before he left academia to work for the big bank.

“I do not believe that I approved the selection of Citigroup as a preferred lender for NYU students,” said Lew in response to a question by Sen. Charles Grassley (R-IA). Lew claims Citi offered NYU a kickback of 0.25% of the value of student loans, but only after first winning a competitive process. 

While serving as an NYU vice president in charge of the university’s budget and finances from 2001 to 2006, Lew drew an annual salary of $840,339, a figure higher than that of most of the nation’s university presidents. Lew then went to work for Citigroup, where he made a base salary of $350,000, plus bonuses, including one for nearly $950,000. That payment came just days after taxpayers spent billions bailing out the bank.

Whether Lew helped broker the NYU deal with Citi, only to then land a job working at Citi, is presently unclear. Indeed, Grassley says Lew’s lack of candor in answering questions during his confirmation has been “distressing.”

“Mr. Lew has a lack of knowledge or a poor memory of some of the perks he received through his tenure at New York University and Citigroup,” said Grassley in a statement. “His lack of recall is distressing.”

Democrats are scrambling to run out the clock on Lew’s confirmation and are presently denying requests from Republicans for more time to get answers before the senate votes on whether to confirm Lew to the top post at Treasury.