The New York Federal Res­erve under Tim Geithner “severely limited its ability” to extract ­concessions from AIG’s counter­parties in talks that ended with $27.1bn (€18.18bn, £16.25bn) of public money transferred to the likes of Société Générale and Goldman Sachs, according to a government watchdog.

But in spite of criticism levelled at the team of Mr Geithner, now Treasury secretary and last year president of the New York Fed, the watchdog’s report fails to find evidence that the institution was negligent in not demanding “haircuts” from the counterparties to AIG’s credit default swap contracts.