Washington, D.C. —
Senator John Thune today introduced an amendment to the Housing Bill (S.896) that would prohibit the Treasury Department from re-spending funds returned by financial institutions under the Troubled Asset Relief Program (TARP). Several financial institutions that received TARP funding have either returned or expressed an interest in returning billions in taxpayer funding.
"Americans need to know that their tax dollars are only being used for their originally intended purpose," said Thune. "Once banks and other financial institutions return money to the Treasury, it should not be recycled for other purposes without the approval of Congress."
Last year, Congress authorized the Treasury Department to spend up to $700 billion through TARP. Senator Thune's amendment would reduce that authorization as financial institutions return TARP money to the Treasury Department, thus preventing the Treasury Department from giving the money to other financial institutions or using it for other programs unless Congress passes legislation to allow such financial assistance.
On April 23, 2009, the Special Inspector General for TARP, Neil Barofsky, stated in his quarterly report to Congress that 12 separate programs are being funded under TARP involving up to $3 trillion of government and public funds. Amazingly, this is the equivalent to the size of the entire federal budget. This certainly was not what Congress was told the funding would be used for.
The Barofsky report spans 247 pages and it says that the very character of the TARP program makes it "inherently vulnerable to fraud, waste and abuse, including significant issues related to conflicts of interest facing fund managers, collusion between participants and vulnerabilities to money laundering." It would seem irresponsible to continue recycling money into TARP if the very nature of the program makes it susceptible to fraud. In fact, the Special Investigator's office already has 20 criminal investigations underway.
Recently, Secretary of the Treasury Timothy Geithner indicated that he intends to spend roughly $25 billion in funding that financial institutions are expected to repay without Congressional approval. The United States Constitution provided Congress with the power of the purse, hence any further spending of TARP funds, or other financial assistance should be determined by Congress.
"Americans need to know that their tax dollars are only being used for their originally intended purpose," said Thune. "Once banks and other financial institutions return money to the Treasury, it should not be recycled for other purposes without the approval of Congress."
Last year, Congress authorized the Treasury Department to spend up to $700 billion through TARP. Senator Thune's amendment would reduce that authorization as financial institutions return TARP money to the Treasury Department, thus preventing the Treasury Department from giving the money to other financial institutions or using it for other programs unless Congress passes legislation to allow such financial assistance.
On April 23, 2009, the Special Inspector General for TARP, Neil Barofsky, stated in his quarterly report to Congress that 12 separate programs are being funded under TARP involving up to $3 trillion of government and public funds. Amazingly, this is the equivalent to the size of the entire federal budget. This certainly was not what Congress was told the funding would be used for.
The Barofsky report spans 247 pages and it says that the very character of the TARP program makes it "inherently vulnerable to fraud, waste and abuse, including significant issues related to conflicts of interest facing fund managers, collusion between participants and vulnerabilities to money laundering." It would seem irresponsible to continue recycling money into TARP if the very nature of the program makes it susceptible to fraud. In fact, the Special Investigator's office already has 20 criminal investigations underway.
Recently, Secretary of the Treasury Timothy Geithner indicated that he intends to spend roughly $25 billion in funding that financial institutions are expected to repay without Congressional approval. The United States Constitution provided Congress with the power of the purse, hence any further spending of TARP funds, or other financial assistance should be determined by Congress.