The Invisible Robert Rubin

He’s in Citigroup’s upper management. Why don’t the scandal stories say so?

Yesterday’s New York Times story  alleging Enron-related financial improprieties by Citigroup neglected to mention that former Treasury Secretary Robert Rubin is a director and “member, office of the chairman” at Citigroup (which encompasses Citicorp and Citibank). So did today’s follow-up in the Times, and so did today’s stories in the Washington Post and the Wall Street Journal. Indeed, in a Nexis database search, Chatterbox could find no news article anywhere that contained both Rubin’s name and the word “prepay,” the practice that has come under scrutiny. During the past few days, Rubin’s name has been all over the newspapers and newsmagazines, but these all appear to be adulatory references bemoaning the fact that America must face financial turmoil with Paul O’Neill, not Robert Rubin, running the Treasury Department. (Rubin wrote one of these stories himself.)

Citigroup’s (and J.P. Morgan Chase’s) prepaid contracts with Enron were very complex, and none of the papers has done an especially good job at explaining precisely what the scandal is. Possibly there is none. But once the editorial decision was made to give this story major play, there was no justification for airbrushing Rubin out of it, especially given what’s known about Rubin’s previous, ethically questionable attempt to get the Bush Treasury Department to bail Enron out.

Rubin’s free ride won’t last because Republicans won’t allow it. The Republican National Committee today spammed a “research briefing” to reporters headlined “Rubin, Citibank & Enron,” and Senate Minority Leader Trent Lott told reporters that the Governmental Affairs subcommittee, whose hearings this week prompted the Citicorp stories, “may want to call in Mr. Rubin and others.” He continued:

I don’t know Mr. Rubin’s involvement. I—you know, I think he did a lot of good things when he was secretary of Treasury, and I’m not alleging anything improper, but I do think, if they were involved in this kind of operation, I think it needs to be explored. You can’t ask questions on one side if you’re not going to ask questions on the other side if something like this is done, which looks—you know, it looks on its face suspicious.

Chatterbox expects that, in the face of this pressure, financial reporters will make at least passing reference to Rubin in future stories. It’s pretty appalling, though, that they’ve protected him so blatantly thus far. Chatterbox chalks it up not to liberal media bias, but rather to Rubin’s membership in the bipartisan Society of Media Darlings, whose other members include James Baker and John McCain.