Bailout for Breakfast: TARP Lacks Fraud Protections
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Good morning! It's a big day for TARP oversight. This morning, Neil Barofsky, the special inspector general for the TARP (aka the TARP cop), released his second quarterly report. A copy should appear on the SIGTARP Web site shortly.
The main takeaway: There are plenty of ways for fraudsters to game the TARP, and two programs seem particularly vulnerable. There's the TALF, the Federal Reserve lending facility that, like just about everything else the Fed does, lacks for transparency. And then there's the big toxic asset purchase program. The government shouldn't launch that program until there are better fraud protections, Barofsky says. Here are some write-ups: WSJ, NYT, LAT, WaPo.
Also, this morning at 10 a.m., the Congressional Oversight Panel will be grilling Treasury Secretary Tim Geithner in a public hearing. It will be webcast on COP's Web site and also broadcast on C-Span.
Other links:
- Pay Rule Led Chrysler to Spurn Loan, Agency Says (WaPo)
- More Rescued Banks Might Suspend Interest Payments (WaPo)
- Geithner Weighs Bank Repayments (WSJ)
- Former Firm of Obama Aide Tied to Pension-Fund Probe (WSJ)
- Treasury Pressures Chysler, Fiat in Meetings (WSJ)
- AIG Gets Aid, Minus Bonus Pay (WSJ)
- Despite Profit, BofA's Investors Express Concern (Char. Observer)
- Bank Profits Appear Out of Thin Air (NYT)
As big banks return their TARP money, Fannie Mae and Freddie Mac continue to be a drain.
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