Little known firm playing big rescue role

Sen. Charles Grassley, R-Iowa, has raised concerns about BlackRock, a little known New York firm playing many roles in the economic recovery process.

The company, 47 percent owned by Bank of America, has been hired as a government consultant on rescue efforts involving investment bank Bear Stearns, the country’s largest insurance company American International Group and giant Citigroup, The New York Times reported Tuesday.

While simultaneously managing its own $1.3 trillion money management business, BlackRock has been hired to evaluate assets owned by the Federal Home Loan Mortgage Corp. and the Federal National Mortgage Association, which were seized by the government last fall.

Grassley said, the potential for a conflict of interest is great and it is just very difficult to police.

The company has divided its consulting and management divisions into two separate buildings with separate computer networks. Nevertheless, how can one company have so much control over the process? asked Scott Amey, general counsel at the Project on Government Oversight, a Washington-based non-profit group.

James Wilkinson, recently chief of staff to former Treasury secretary Henry Paulson Jr. had another opinion, calling BlackRock’s Chief Executive Officer Laurence Fink a patriot, for helping the country in time of need.