Congress questions Fed's decision on management of Bear Stearns assets

Chairman Henry Waxman of the House Oversight and Government Reform Committee has questions about the Federal Reserve's unilateral decision to let New-York-based financial firm BlackRock manage $30 billion in assets as part of the rescue of Bear Stearns.

The California Democrat has sent a letter to the president of the Federal Reserve Bank of New York questioning what he termed, "the award of this potentially lucrative position to BlackRock without competition." He wants a response by April 18th.

Last month, the Fed last agreed to take $30 billion in securities off the books of Bear Stearns to facilitate the acquisition of the firm by JPMorgan Chase for $10 a share. The Fed hired BlackRock to manage the portfolio of securities, mostly backed by residential mortgages. A spokesman for the New York Fed declined to comment on Monday.

A BlackRock spokesman could not immediately be reached for comment