The Big Myth: How American Business Taught Us to Loathe Government and Love the Free Market

by Naomi Oreskes

the merger between Citicorp and the Travelers Group to form Citigroup. The merger took advantage of a provision of the Bank Holding Company Act that grants a two-year grace period to any company that becomes a bank holding company by virtue of an acquisition. Citigroup was taking a chance that within two years “financial modernization legislation” would be passed to render what they had done legal. Whether they had inside information, had been lobbying Congress, or had other reason to believe this was a good gamble, they were right: Citicorp merged with Travelers in April 1998 and Gramm-Leach-Bliley was enacted in November 1999. Under the new act, the merger was now legal; some critics called it the “Citigroup Relief Act.”