07/26/2012 11:12 am ET Updated Jul 26, 2012

Barney Frank Defends Timothy Geithner Over Libor Scandal, Blames George W. Bush

Rep. Barney Frank (D-Mass.) would like you to know that the Libor scandal isn't really Timothy Geithner's fault.

Frank, the co-author of the Dodd-Frank financial reform legislation, rushed to Geithner's defense on Wednesday during Geithner's testimony at a House Financial Services Committee hearing, blaming the less-than-agressive response of U.S. policymakers on Republicans.

"I do want to remind people that this all happened under the administration of President Bush," Frank said on Wednesday, according to National Journal. "The notion that this was all the problem of the president of Federal Reserve of N.Y. is frightening."

Frank noted that Geithner was "important but not one of the top administration officials," according to the Associated Press. He listed Federal Reserve Chairman Ben Bernanke and then Treasury Secretary Henry Paulson -- both Bush appointees -- as Geithner's superiors at the time, according to National Journal.

Sixteen banks are under investigation for allegedly rigging the Libor rate, a key interbank lending rate that acts as a benchmark for interest rates around the world -- including, incidentally, taxpayer loans to banks and AIG during the financial crisis. Banks may have been rigging the Libor rate for their own profit for decades, according to reports.

Geithner said on Wednesday that he found out that banks were rigging the Libor rate in early 2008 and notified regulators "early on," according to Reuters. "We took the initiative to bring those concerns to the attention of the broader U.S. regulatory community, including all the agencies that have responsibility for market manipulation and abuse," Geithner said.

But Geithner could have done more, Sheila Bair, former chair of the Federal Deposit Insurance Corporation, said on CNBC last week. "I don't understand why they didn't investigate," she said. "They did have authority to do that."

Frank may be understating Geithner's influence at the time. As president of the Federal Reserve Bank of New York, Geithner served as vice chairman of the Federal Reserve, the Fed's second-highest-ranking official. In addition, the New York Fed directly oversees the financial industry and is the most powerful district of the Federal Reserve.

Check out a timeline of the Libor scandal:

Libor Scandal Timeline