March 26 (Bloomberg) -- The top lawmakers on the Senate Finance Committee said they are reviewing the terms of the taxpayer-backed sale of Bear Stearns Cos. to JPMorgan Chase & Co.

Committee Chairman Max Baucus, a Montana Democrat, and Iowa Senator Charles Grassley, the panel's top Republican, sent a letter to Bear Stearns Chief Executive Alan Schwartz, JP Morgan Chief Executive Jamie Dimon, Treasury Secretary Henry Paulson, Federal Reserve Chairman Ben S. Bernanke, and New York Fed President Timothy Geithner seeking details on how the buyout was negotiated.

``Americans are being asked to back a brand-new kind of transaction, to the tune of tens of billions of dollars,'' Baucus said in a statement. ``With jurisdiction over federal debt, it's the Finance Committee's responsibility to pin down just how the government decided to front $30 billion in taxpayer dollars'' for the deal, Baucus wrote.

The committee's inquiry may herald a broader congressional backlash to the agreement, which Senate Majority Leader Harry Reid of Nevada has described as a ``bailout.''

``Economic times are tight on Main Street as well as on Wall Street, and we have a responsibility to all taxpayers to review the details of this deal,'' Baucus wrote. Grassley said the panel wants to determine whether the arrangement sets a precedent ``for federal involvement when other firms overextend themselves'' and ``whether taxpayers will lose money here.''

Emergency Action

The Fed, in an emergency action earlier this month, authorized a $29 billion loan against illiquid mortgage- and asset-backed securities from Bear Stearns that will be held in a Delaware corporation. JPMorgan contributed $1 billion.

Baucus and Grassley said in their letter that they want to know the names of all negotiators and lawyers involved in the transaction as well as all the steps taken in the transaction and their specific dates and a list of steps yet to be taken.

They want a description of the assets to be secured by the Federal Reserve, including their value and the types of mortgages underlying the assets. The senators asked for all copies of documents that will be filed with the U.S. Securities and Exchange Commission.

The senators asked for a response no later than March 28. Finance Committee spokeswoman Carol Guthrie said the panel doesn't have plans to hold hearings ``as yet.''

Treasury spokeswoman Jennifer Zuccarelli said the department would work with the panel to respond to the request.

JPMorgan spokesman Joseph Evangelisti declined to comment.

The Bear Stearns arrangement has divided Senate Democratic leaders. While Reid says the transaction is unfair to taxpayers, Senator Charles Schumer of New York, the No. 3 Democratic leader, has praised it, calling the Fed's role ``smart'' and ``totally necessary'' to avert a broader meltdown of financial institutions.

To contact the reporter on this story: Ryan J. Donmoyer in Washington at rdonmoyer@bloomberg.net

Last Updated: March 26, 2008 11:14 EDT