Bloggers a buzz over possible Schumer investigation by Calif. AG

Legal News Line Aug. 22, 2008, 10:25am

Chuck Schumer (D)

Jerry Brown (D)

SAN FRANCISCO (Legal Newsline)-- A standard comment from the California Attorney General's office has set bloggers across the country pounding their keyboards over the thought of Democratic Sen. Chuck Schumer being brought down from his powerful perch over his role in the demise of IndyMac Bancorp Inc.

Fifty-one former IndyMac employees sent California Attorney General Jerry Brown a letter - then later released the letter to various news outlets across the state - taking issue with Schumer's letter sent to the Federal Deposit Insurance Corp. questioning the company's ability to survive.

The well-publicized letter, the employees claim, sparked "a run on the bank" that assured its demise. The FDIC took over control of IndyMac on July 11 after more than $1.3 billion was withdrawn in less than two weeks.

The former employees asked Brown to investigate the New York senator's involvement.

The letter itself didn't ignite a firestorm of interest, but when Christine Gasparac, a spokesman for Brown said on Wednesday that the attorney general's office was reviewing the letter and would make a decision on whether to take action, the Internet sparked to life.

Conservative bloggers from Texas, Louisiana, New York and, of course, California, all gleefully reported the news of Brown's potential investigation, even while dismissing it.

"I am eager to see this become way overblown and result in the downfall of an American senator," one blogger wrote.

Another who also posted the story first reported by Reuters said, "Jerry Brown ... would like be governor again. He's an ardent Democrat and lefty and I don't think there's any chance he'd start an investigation against a powerful Democrat like Chuckie Schumer."

CRC Public Relations, the same group who works with the Republican National Committee, released the former IndyMac employees' letter to the press.

Schumer spokesman Brian Fallon told Reuters the public relations' firm involvement should raise skepticism about the merit of the letter itself.

"It certainly raises eyebrows that the firm promoting this letter is the same outfit that fueled the Swift Boat attacks and does work for the RNC," he said.

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