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48–676 PDF 2009

A REVIEW OF TARP OVERSIGHT, 

ACCOUNTABILITY, AND TRANSPARENCY 

FOR U.S. TAXPAYERS 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

OVERSIGHT AND INVESTIGATIONS 

OF THE

COMMITTEE ON FINANCIAL SERVICES 

U.S. HOUSE OF REPRESENTATIVES 

ONE HUNDRED ELEVENTH CONGRESS 

FIRST SESSION 

FEBRUARY 24, 2009 

Printed for the use of the Committee on Financial Services 

Serial No. 111–5 

( 

(II) 

HOUSE COMMITTEE ON FINANCIAL SERVICES 

BARNEY FRANK, Massachusetts, Chairman 

PAUL E. KANJORSKI, Pennsylvania 

MAXINE WATERS, California 

CAROLYN B. MALONEY, New York 

LUIS V. GUTIERREZ, Illinois 

NYDIA M. VELA ́ ZQUEZ, New York 

MELVIN L. WATT, North Carolina 

GARY L. ACKERMAN, New York 

BRAD SHERMAN, California 

GREGORY W. MEEKS, New York 

DENNIS MOORE, Kansas 

MICHAEL E. CAPUANO, Massachusetts 

RUBE ́ N HINOJOSA, Texas 

WM. LACY CLAY, Missouri 

CAROLYN MCCARTHY, New York 

JOE BACA, California 

STEPHEN F. LYNCH, Massachusetts 

BRAD MILLER, North Carolina 

DAVID SCOTT, Georgia 

AL GREEN, Texas 

EMANUEL CLEAVER, Missouri 

MELISSA L. BEAN, Illinois 

GWEN MOORE, Wisconsin 

PAUL W. HODES, New Hampshire 

KEITH ELLISON, Minnesota 

RON KLEIN, Florida 

CHARLES WILSON, Ohio 

ED PERLMUTTER, Colorado 

JOE DONNELLY, Indiana 

BILL FOSTER, Illinois 

ANDRE ́ CARSON, Indiana 

JACKIE SPEIER, California 

TRAVIS CHILDERS, Mississippi 

WALT MINNICK, Idaho 

JOHN ADLER, New Jersey 

MARY JO KILROY, Ohio 

STEVE DRIEHAUS, Ohio 

SUZANNE KOSMAS, Florida 

ALAN GRAYSON, Florida 

JIM HIMES, Connecticut 

GARY PETERS, Michigan 

DAN MAFFEI, New York 

SPENCER BACHUS, Alabama 

MICHAEL N. CASTLE, Delaware 

PETER T. KING, New York 

EDWARD R. ROYCE, California 

FRANK D. LUCAS, Oklahoma 

RON PAUL, Texas 

DONALD A. MANZULLO, Illinois 

WALTER B. JONES, JR., North Carolina 

JUDY BIGGERT, Illinois 

GARY G. MILLER, California 

SHELLEY MOORE CAPITO, West Virginia 

JEB HENSARLING, Texas 

SCOTT GARRETT, New Jersey 

J. GRESHAM BARRETT, South Carolina 

JIM GERLACH, Pennsylvania 

RANDY NEUGEBAUER, Texas 

TOM PRICE, Georgia 

PATRICK T. MCHENRY, North Carolina 

JOHN CAMPBELL, California 

ADAM PUTNAM, Florida 

MICHELE BACHMANN, Minnesota 

KENNY MARCHANT, Texas 

THADDEUS G. McCOTTER, Michigan 

KEVIN McCARTHY, California 

BILL POSEY, Florida 

LYNN JENKINS, Kansas 

CHRISTOPHER LEE, New York 

ERIK PAULSEN, Minnesota 

LEONARD LANCE, New Jersey 

JEANNE M. ROSLANOWICK, Staff Director and Chief Counsel 

(III) 

SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS

DENNIS MOORE, Kansas, Chairman 

STEPHEN F. LYNCH, Massachusetts 

RON KLEIN, Florida 

JACKIE SPEIER, California 

GWEN MOORE, Wisconsin 

JOHN ADLER, New Jersey 

MARY JO KILROY, Ohio 

STEVE DRIEHAUS, Ohio 

ALAN GRAYSON, Florida 

JUDY BIGGERT, Illinois 

PATRICK T. MCHENRY, North Carolina 

RON PAUL, Texas 

MICHELE BACHMANN, Minnesota 

CHRISTOPHER LEE, New York 

ERIK PAULSEN, Minnesota 

(V) 

C O N T E N T S 

Page 

Hearing held on: 

February 24, 2009 ............................................................................................ 1 

Appendix: 

February 24, 2009 ............................................................................................ 29 

WITNESSES 

TUESDAY, FEBRUARY 24, 2009 

Barofsky, Neil M., Special Inspector General, Office of the Special Inspector 

General, Troubled Asset Relief Program ............................................................ 4 

Dodaro, Gene L., Acting Comptroller General of the United States, Government Accountability Office .................................................................................. 6 

Warren, Elizabeth, Chair, Congressional Oversight Panel, and Leo Gottlieb 

Professor of Law, Harvard University ................................................................ 8 

APPENDIX 

Prepared statements: 

Moore, Hon. Dennis .......................................................................................... 30 

Bachmann, Hon. Michele ................................................................................. 32 

Klein, Hon. Ron ................................................................................................ 34 

Barofsky, Neil M. .............................................................................................. 35 

Dodaro, Gene L. ................................................................................................ 40 

Warren, Elizabeth ............................................................................................ 55 

(1) 

A REVIEW OF TARP OVERSIGHT, 

ACCOUNTABILITY, AND TRANSPARENCY 

FOR U.S. TAXPAYERS 

Tuesday, February 24, 2009 

U.S. HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON OVERSIGHT

AND INVESTIGATIONS, 

COMMITTEE ON FINANCIAL SERVICES, 

Washington, D.C. 

The subcommittee met, pursuant to notice, at 2:41 p.m., in room 

2220, Rayburn House Office Building, Hon. Dennis Moore [chairman of the subcommittee] presiding. 

Members present: Representatives Moore of Kansas, Lynch, 

Klein, Speier, Moore of Wisconsin, Kilroy, Driehaus; Biggert, Lee, 

and Paulsen. 

Chairman MOORE OF KANSAS. This hearing of the Subcommittee 

on Oversight and Investigations of the House Financial Services 

Committee will come to order. Our hearing this afternoon is entitled, ‘‘A Review of TARP Oversight, Accountability, and Transparency for U.S. Taxpayers.’’ 

We will begin our first subcommittee of the year with members’ 

opening statements, up to 10 minutes per side, and then we will 

hear testimony from our 3 witnesses. After that, members will each 

have up to 5 minutes to question our witnesses. Without objection, 

all members’ opening statements will be made a part of the record. 

I now recognize myself for up to 5 minutes for an opening statement. 

Five months ago, some Members of Congress were told by former 

Treasury Secretary Paulson that the financial meltdown was accelerating and we may not have an economy on Monday if Congress 

failed to pass the rescue bill. 

On September 29, 2008, the House first considered the Emergency Economic Stabilization Act, but the measure failed by a vote 

of 205 to 228. The DOW lost 777 points after the vote and we saw 

a loss of $1.2 trillion in the stock market. The Senate later added 

a number of unrelated tax provisions and approved the bill by a 

vote of 74 to 25 on October 1st. The House approved the Senate 

version by a vote of 263 to 171 on October 3rd, and it was signed 

into law by the President the next day. 

We are in a deep and painful economic downturn, the likes of 

which we have not seen in generations. The evidence is all around 

us and very clear. Just last month, our economy lost nearly 600,000 

jobs and that is on top of the 2.6 million jobs we lost in 2008. But 

2 

something we should remember, our financial sector must be stabilized and confidence restored before we see any economic recovery. 

‘‘Facts are stubborn things,’’ John Adams once said, and there is 

no way around this fact. When Congress enacted the Emergency 

Economic Stabilization Act, the new law not only created a $700 

billion troubled Troubled Assets Relief Program, commonly called 

TARP, we made sure to include strong oversight protections for 

U.S. taxpayers. This included the creation of the Financial Stability 

Oversight Board, the Special Inspector General for TARP, the Congressional Oversight Panel, and new audit and oversight mandates 

for the Comptroller General of the United States. 

I am pleased today to have three representatives of these TARP 

oversight bodies here to testify. Their work—and the work of their 

staff—has contributed to a number of reports totaling over 1,700 

pages, all of which are available on the Internet. In fact, the Congressional Research Service has written a 21-page paper explaining 

all the accountability reports required by the Emergency Economic 

Stabilization Act. In the words of the Project on Government Oversight early this month, ‘‘The world would be a better place if all 

oversights were this aggressive.’’ 

In light of recent announcements by the Obama Administration 

regarding the use of TARP funds and their comprehensive financial 

stability plan, it is important that Congress ensure oversight organizations, understand their respective roles in the oversight process, cooperate with each other, and work to avoid repetitive efforts 

and inefficiencies. 

I hope today’s hearing will help us identify any gaps, either in 

statute or regulation, that may exist with respect to the oversight 

of TARP and how we can better protect you as taxpayers in this 

effort. 

For example, the Senate has already approved S. 383, the Special Inspector General for the TARP Act. While this bill primarily 

deals with the Special Inspector General’s office, the question is, 

would it improve the overall TARP oversight framework? What is 

the current status of your organization’s hiring efforts and are 

steps being taken to avoid potential or real conflicts of interest, 

what oversight work is your organization currently focused on, and 

finally, does the oversight structure we are putting in place ensure 

that the use of TARP funds follows the clear principles laid out by 

Congress? 

In Section 2 of the Economic Stabilization Act, the stated purpose of the new law was to restore liquidity and stability to the financial system, as well as to ensure that these efforts: protect 

home buy use, college funds, retirement accounts, and life savings; 

reserve ownership; promote jobs and economic growth; maximize 

overall return to the taxpayer; and provides public accountability 

for the exercise of such authority. 

I look forward to hearing your testimony and discussing these 

important issues. My constituents are anxious and frustrated and 

they deserve the strongest oversight and structure that will provide 

the accountability the law requires. And I think probably every 

member of this panel feels the same way. 

3 

I now recognize for 5 minutes the distinguished ranking member 

of the subcommittee, my colleague from Illinois, Mrs. Biggert. 

Mrs. BIGGERT. Thank you, Chairman Moore, and thank you for 

holding today’s hearing. I look forward to working with you and all 

the members of this subcommittee during the 111th Congress. 

I welcome today’s witnesses and thank them for sharing their expertise with us today. I really am disappointed, however, that the 

Department of the Treasury didn’t produce a witness for this hearing. I believe, Mr. Chairman, that we are sending a letter to Secretary Geithner demanding an explanation of why a witness was 

not produced to testify at this hearing, and we would like our other 

colleagues to join us. 

Treasury has yet to answer critical questions about the trillions 

of taxpayer dollars being expended through TARP. Showing up 

with no answers is unacceptable, which has been the case in Treasury’s most recent appearances before our committee, but not showing up at all is both disrespectful to the American people and an 

abandonment of duty. 

It is this lack of communication that has most angered the people 

who pay the bills, the American taxpayers. Granted, there is plenty 

of communication out there about the alleged misuse of TARP 

funds, lavish parties and corporate jets and expensive retreats, but 

what do we hear of TARP funds that have been put to good use. 

Not enough. 

It is no small wonder there is a lack of confidence in the program. American taxpayers trusted Federal leaders who asked them 

to front trillions of dollars to prop up the financial and auto industries on the verge of collapse and homeowners facing foreclosure, 

but they have questions that deserve answers. What is the strategy? Where has the money gone and is it working? What benchmarks have been set to determine success or failure? Are we throwing good taxpayer dollars after bad in this TARP program? 

It has been 5 months since the enactment of TARP and we are 

still waiting for answers. We still need evidence that TARP excludes unscrupulous lenders and bad actors. We still need to know 

that TARP funds aren’t being sent to the same folks who are engaged in unsound lending practices that were the source of our 

problems in the beginning. 

I hope that today’s witnesses can help us better understand what 

mechanisms Treasury needs to put in place to weed out bad actors 

and not reward bad behavior. 

My constituents are sick and tired of bailouts. They paid their 

mortgages on time, they have saved and invested for their future, 

they worked hard and paid their bills and taxes. Now they continue 

to see Federal money fly out the door and they want answers. 

Granted, we all understand that many people face foreclosures 

due to traditional reasons: loss of a job; death in the family; or 

medical issues. Some were the unfortunate victims of loose lending 

standards and predatory lending, but there are many homeowners 

who overextended themselves, couldn’t afford their home even with 

Federal assistance, lied about their income on the loan application, 

flipped properties for profit, or were part of a mortgage fraud ring. 

Is it fair to take money from all the other homeowners and taxpayers to help this latter group of homeowners? I don’t think so. 

4 

It’s certainly not fair to all of those Americans who are hardworking and working to make ends meet without a break or a bailout. 

I hope that today’s witnesses can discuss the ways that the Administration should follow through with its commitment that TARP 

funds or any taxpayer funds be used solely for responsible homeowners. 

And what is the exit strategy? I don’t know about everybody else 

in this room, but my constituents don’t want the Federal Government—big brother—owning, operating and footing the bill for 

banks, auto companies, insurance companies and everything in between. America is not pro-socialism. We are pro-democracy and 

pro-free market. 

Additionally, our national debt is rising at an unprecedented rate 

and we cannot afford to pass down this burden to future generations of Americans. With that, I conclude and look forward to hearing from our witnesses. 

Chairman MOORE OF KANSAS. Thank you, Mrs. Biggert. 

I’m pleased to introduce the witnesses we have for today’s hearing. First, we have Mr. Neil Barofsky, the Special Inspector General for TARP, whom I had the pleasure to meet a few weeks ago. 

Prior to assuming his new position, he was a Federal prosecutor in 

the United States Attorney’s Office for the Southern District of 

New York for more than 8 years and investigated cases of mortgage and securities fraud. 

Mr. Barofsky also led the investigation that resulted in the indictment of the top 50 leaders of the Revolutionary Armed Forces 

of Columbia on narcotics charges, a case described by the then-attorneys general, as the ‘‘biggest narcotic indictment filed in United 

States history.’’ 

Next, we will hear from Mr. Gene Dodaro, the acting Comptroller 

General of the United States. In a GAO career dating back more 

than 30 years, he has held a number of key positions at GAO. For 

the last 9 years, Mr. Dodaro has served as the Chief Operating Officer, the number two leadership position in the Agency, assisting 

the Comptroller General and providing leadership and vision for 

the GAO’s diverse multidisciplinary workforce. 

And finally, we are glad to have Professor Elizabeth Warren testifying before our subcommittee. Professor Warren is the chair of 

the Bipartisan Congressional Oversight Panel. She also serves as 

a law professor at Harvard University and has written 8 books and 

more than 100 scholarly articles dealing with credit and economic 

stress. 

Without objection, your written statements will be made part of 

the record and you will each be recognized for a 5-minute opening 

statement summarizing your testimony. 

We will start, Mr. Barofsky, with you, sir, for 5 minutes. 

STATEMENT OF NEIL M. BAROFSKY, SPECIAL INSPECTOR 

GENERAL, OFFICE OF THE SPECIAL INSPECTOR GENERAL, 

TROUBLED ASSET RELIEF PROGRAM 

Mr. BAROFSKY. Thank you. 

Chairman Moore, Ranking Member Biggert, and members of the 

subcommittee, I am honored to appear before you today as a SpeVerDate Nov 24 2008 16:20 Jun 08, 2009 Jkt 048676 PO 00000 Frm 00010 Fmt 6633 Sfmt 6633 K:\DOCS\48676.TXT TERRIE
5 

cial Inspector General for the Troubled Asset Relief Program, or as 

we call it, SIGTARP. 

Approximately $300 billion has already gone out the door and including the recently announced programs, Treasury intends to leverage the total TARP allotment, with the Federal Reserve and 

others, to fund at least 8 separate programs under the TARP involving more than $2.8 trillion. These huge investments of taxpayer money will invariably create opportunities for fraud, waste, 

and abuse and will require strict oversight. 

To meet this massive oversight challenge, I have focused 

SIGTARP on three areas: transparency; coordinated oversight; and 

enforcement. 

Transparency has been an area of focus of my office from day 

one. The adoption of our early recommendations has resulted in all 

the TARP agreements, a commitment from Treasury to post all the 

TARP agreements onto the Internet, and the two largest recipients 

of TARP funds are being required to report on their use of TARP 

funds. 

We have also initiated four separate audits: First, into TARP’s 

recipients’ use of funds; second, into executive compensation; third 

into the impact of outside influences, such as lobbyists on the 

TARP application process; and fourth, into the circumstances under 

which Bank of America received $45 billion in cash and commitments to a $100 billion of asset—of guaranty of toxic assets under 

three separate TARP programs and four separate transactions. We 

believe that these audits and these initiatives will shed light into 

some of the darkest areas of the TARP. 

As to our second area of focus, coordinated oversight, it is my 

honor and privilege to appear today with my co-panelists. For the 

last 2 months, we have closely worked together to coordinate oversight and provide maximum oversight coverage of the vast terrain 

of the TARP. I have also founded and chair the TARP IG Council 

where, along with GAO, we coordinate oversight among the other 

inspectors general who cover TARP and TARP-related programs. 

We have also tried to have a positive impact on TARP programs 

before the money goes out the door. Treasury has adopted several 

of our recommendations for TARP agreements under the auto finance, targeted investment, and asset guaranty programs and we 

are actively working with Treasury in making similar recommendations with respect to the newly initiated programs that were recently announced. 

Our third area of focus is enforcement. Of the four primary oversight bodies set forth in the Stabilization Act, we alone stand as 

the TARP oversight body charged with criminal law enforcement, 

as the cop on the beat. To meet this challenge, we have developed 

key relationships with other law enforcement agencies. We have already opened several criminal investigations and we have teamed 

up with the SEC in shutting down a multi-million dollar securities 

fraud scam in Tennessee. 

We are planning to set up regional and program-specific task 

forces around the country, both to deter criminal activity before it 

occurs and to make sure we have the right resources in place to 

investigate and prosecute any and all who try to criminally profit 

from this national crisis. 

6 

Unfortunately, history teaches us that our law enforcement task 

will not be an easy one. When government offers assistance, whether for hurricane relief, Iraq reconstruction, or the savings and loan 

meltdown, criminals are drawn like flies to honey. If by percentage 

terms some of the estimates of fraud in those programs are repeated in the TARP, we are looking at literally hundreds of billions 

of taxpayer money lost in fraud. We must be vigilant. 

And while I believe that SIGTARP is effectively establishing a 

framework that will permit us to meet our oversight obligations, 

we face serious challenges, particularly with respect to identifying 

and recruiting the highly trained and experienced government investigators and auditors that will be necessary to fulfill our mission. 

We desperately need more hiring flexibility, the type of which is 

contained in S. 383. This bipartisan bill, unanimously approved in 

the Senate on February 4th, would give us a limited version of 

some of the authorities that other startup inspector generals have 

told me were absolutely essential in standing up their offices. 

The TARP program has changed significantly since the Stabilization Act was passed last October. Originally intended to purchase 

and manage $700 billion of toxic assets, that effort now stands as 

just a portion of one of the 8 programs under the TARP and just 

25 percent of the total of $2.8 trillion that are contemplated to be 

involved. Quick passage of this important and essential legislation 

will help me build the necessary core of my office to meet this challenge. 

Chairman Moore, Ranking Member Biggert, members of the subcommittee, I commend you for your efforts to ensure proper oversight over the trillions of dollars being expended under the TARP 

and its related programs and I look forward to answering any questions that you may have. 

[The prepared statement of Mr. Barofsky can be found on page 

35 of the appendix.] 

Chairman MOORE OF KANSAS. Thank you very much, Mr. 

Barofsky. 

And next, Mr. Dodaro, you are recognized for 5 minutes, sir. 

STATEMENT OF GENE L. DODARO, ACTING COMPTROLLER 

GENERAL OF THE UNITED STATES, GOVERNMENT ACCOUNTABILITY OFFICE 

Mr. DODARO. Good afternoon Mr. Chairman, Ranking Member 

Biggert, and members of the subcommittee. I’m very pleased to be 

here today to assist your efforts to provide oversight over the Troubled Asset Relief Program. 

GAO has a number of responsibilities under the legislation, the 

first of which is to report every 60 days to the Congress on our 

oversight efforts of Treasury’s implementation. Since the Act was 

passed on October 3rd, we have issued two reports to comply with 

that mandate. 

The first report was issued on December 2nd, and we provided 

testimony before the full committee on that report back in December. We issued our second report on January 30th. In both of those 

reports, we focused on a series of recommendations to improve the 

7 

accountability and the transparency of the TARP program. Our recommendations fell into three main categories. 

First, in our first report, we pointed out that Treasury did not 

have a process in place to monitor and report on the use of the 

funds under the Capital Purchase Program. We thought that this 

needed to be rectified. We made a recommendation. As a result of 

our recommendation, Treasury issued a monthly survey now to the 

20 largest institutions receiving funds under the Capital Purchase 

Program and the results are starting to come in about their overall 

lending practices, thereby providing a bit more transparency to the 

process. 

We believe, however, that is not enough. We think that all participating organizations should be reporting on a monthly basis 

their lending activities and how the funds are being used consistent with the purposes of the legislation. I would note that in 

Treasury’s most recent articulation of their plans going forward, 

they embodied our recommendation in there to provide and solicit 

a plan ahead of time from the agencies that would receive money 

in the future under the Capital Assistance Program and to provide 

monthly reports back on lending practices. We hope that they implement that effectively for the second half of the TARP program. 

The second major area has been communication strategy. Now 

this program has been plagued with communication problems from 

the outset. Communications were poor initially in describing the 

change from the purchase of the toxic assets moving to the Capital 

Purchase Program. We recommended that Treasury improve its 

communication strategy with the Congress and other stakeholders. 

They have taken a number of initiatives to do this. 

In our last report in January, we recommended that they articulate a coherent vision for the TARP program going forward. Earlier 

this month, the Financial Stability Plan was announced and also 

the homeowners’ program was announced in terms of preserving 

homeownership and stability in that area as well, but there are a 

lot more details that need to be articulated for people to understand exactly how those programs are going to proceed. 

I think the idea of doing the stress test at the banks was a good 

idea, but there are a lot of details, both on the financial stability 

plan, as well as the homeownership affordability and stability plan 

as well. So we plan to continue monitoring Treasury’s efforts to 

continue to articulate the strategy. 

The last category of recommendations that we had was in Treasury’s management of the program. In hiring, we suggested they expedite their hiring practices to stand up the program and they did 

provide a good transition between the Administrations, which was 

one of our earlier recommendations in December, but they still 

need to hire and standup the type of resources that they need. 

And they really don’t have a plan yet on the total amount of resources they need, which is in part due to having a vision of how 

they are going to implement the program. We recommended that 

once that vision is put in place, they have a comprehensive human 

capital strategy to support that plan and to actually deliver results 

going forward. 

In the contracting area, we suggested that they have the right 

skills and people needed, provide training to them, move to fixed 

8 

price contracts where they can away from the time and materials 

contracts that they invariably had to have up-front going forward, 

and we made a number of recommendations for internal controls 

and other necessary management tools that they need to have in 

place. 

Along with Mr. Barofsky and Ms. Warren, you know, I would like 

to compliment both of them publicly for the type of cooperation that 

has been at play here. GAO was right there at the beginning in October right after the Act was passed carrying out our responsibilities. As they came onboard in November and December, we set up 

effective coordinating mechanisms and I believe we are doing what 

we can to make sure we have adequate coverage to fulfill the responsibilities under the legislation. 

I would be happy to answer any questions additionally as to 

GAO’s own efforts as well as some limitations on our authority at 

the Federal Reserve. So thank you very much. 

[The prepared statement of Mr. Dodaro can be found on page 40 

of the appendix.] 

Chairman MOORE OF KANSAS. Thank you, Mr. Dodaro. 

Ms. Warren. 

STATEMENT OF ELIZABETH WARREN, CHAIR, CONGRESSIONAL OVERSIGHT PANEL, AND LEO GOTTLIEB PROFESSOR OF LAW, HARVARD UNIVERSITY 

Ms. WARREN. Thank you, Chairman Moore, Ranking Member 

Biggert, and members of this subcommittee. It’s a pleasure to be 

here today. 

I am the chair of the Congressional Oversight Panel, but because 

I am not tightly scripted, I should remind everyone I speak, in that 

sense, on my own behalf and not necessarily the views of the 

Panel. 

I am very pleased to be here because of the important responsibility on this subcommittee and to try to help in any way that we 

can. I also want to start by echoing the remarks of Mr. Barofsky 

and Mr. Dodaro, that we are all working together. We are sharing 

information as much as we can, strategy as much as we can. We 

think there is plenty of work to go around and we are doing what 

we can to enhance each other’s efforts rather than compete in any 

way. 

I just want to mention about the purpose of the Congressional 

Oversight Panel. I see our purpose at three levels. We are here to 

do oversight of the operation of the TARP, but also the direction 

in which Treasury is aiming TARP funds, and then in a larger 

sense, the broader efforts to restore stability to the financial system. 

The Congressional Oversight Panel is charged, by statute, with 

responsibility for reporting on Treasury’s use of the TARP funds, 

the impact on financial markets, financial institutions and market 

transparency, whether foreclosure mitigation efforts are successful, 

and the long-term costs and benefits to the taxpayer. So far, we 

have issued three oversight reports and, as required by statute, a 

report on regulatory reform. 

All of these aim toward a central question and that is whether 

TARP benefits the American family and the economy and if it does 

9 

not, why not and what kind of constructive suggestions can we 

make. This is what we come to you with. 

I want to give you one example of the Oversight Panel’s approach, and that is with our valuation report. In our December 9th 

oversight report, we asked, among many other questions, whether 

or not the public, the taxpayer, is getting a fair deal for the money 

that is being infused into these financial institutions. 

On December 30th, then-Secretary Paulson responded to us by 

saying yes, these are investments, not subsidies, and they are 

made at or near par. We could have stopped there, but we thought 

it was appropriate to do an independent investigation pulling together recognized experts to be able to do a valuation of the transactions. 

In our February 6th report, we made that report public and what 

we discovered is that Treasury had substantially subsidized the 

banks to that point. They had paid about $78 billion more than the 

value of the assets they received at the time of the transaction. 

This is not about subsequent declines in market, this is about on 

the day of the transaction. In effect, for every dollar of taxpayer 

money put into the financial institutions, on that date, we got back 

about 66 cents in stock and warrants as they were currently valued. 

Now I want to be clear. There may be good policy reasons to subsidize the banks. That is an independent inquiry. But there is no 

good policy reason not to be honest about that, not to be forthcoming with the American people. Misdirection undermines the 

confidence of both the American people and the worldwide economies. So in this report, as in all of our reports, we return to our 

central themes of transparency, accountability, and a clearly articulated plan and strategy for executing that plan. 

Just to give you a preview of coming events, our March report 

will be focused on foreclosure mitigation efforts. We were very 

pleased to hear the President announce the Homeowner Affordability and Stability Plan last week principally because it shows 

the importance of dealing with the mortgage foreclosure problem as 

a central element in trying to pull this economy out of the ditch 

and get it back in an operational mode, but we are going to make, 

I think, two important points as we go forward in our report. 

The first will focus on the inadequacy of the current data, how 

little we know, in a factual sense, about what is going on in the 

mortgages themselves and particularly, in the loan modifications. 

And we want to make the point that if you don’t have good data, 

it is hard both to analyze the problem with any specificity, design 

a solution that is going to meet that problem, and then evaluate 

whether or not the execution of that solution is really doing something useful. 

The second point we will be making in our report is that we are 

going to identify where many of the current obstacles are to reaching economically rational mortgage foreclosure mitigation. In other 

words, why aren’t the workouts happening on their own? And to 

use that as a checklist for evaluating any proposal to deal with 

these foreclosures. It may help us evaluate whether or not those 

proposals are likely to be useful by zeroing in on where the problems are. 

10 

I just want to say, by way of conclusion, nearly $350 billion has 

already been spent in the 5 months since TARP was authorized by 

Congress. The themes that we have returned to time and time 

again in the Congressional Oversight Panel have been about transparency, accountability, and a strategy that comes from clearly articulated goals. This is the only way that we can maintain public 

confidence in this program and in our ability to solve our economic 

problems. 

Thank you again for having me here and I’m here for whatever 

questions you may want to ask. 

[The prepared statement of Professor Warren can be found on 

page 55 of the appendix.] 

Chairman MOORE OF KANSAS. Thank you, Ms. Warren. 

As we have discussed before, Mr. Barofsky, I am very pleased 

your office has sent use of funds letters to every TARP recipient 

asking them what they have done or plan to do with the taxpayer’s 

funds they have received. What is the status of those requests? 

Mr. BAROFSKY. Our requests had basically a 30-day deadline so 

they are due back in early March. We sent them over a course of 

3 days in early February. So far we have actually had, I was told 

this morning, 17 responses. My audit chief describes them as good 

responses, meaning they have had substantive information. 

We have had a number of inquiries for clarification. We are going 

to be posting something shortly on our Web site, www.sigtarp.gov, 

some questions and answers to give guidance and clarification for 

those requests, for those banks that are in any way confused or 

seeking such clarifications. The ABA reached out to us and asked 

us to do that and we will be doing that. And we look forward to 

getting what we hope to be a 100 percent response rate in early 

March. 

Chairman MOORE OF KANSAS. And how many did you send out? 

Do you know, sir? 

Mr. BAROFSKY. It was the exact number of TARP recipients as 

of the date. I think it was a little bit over 350. 

Chairman MOORE OF KANSAS. Thank you. 

Second question to you, Mr. Barofsky. As you know, the Senate 

recently approved S. 383, a bill expanding your Office’s authorities 

as Special Inspector General for TARP. You expressed your support 

for the bill in your testimony. Would you explain the importance 

of timing in your work and why the House should act quickly on 

this bill. Why is that important? 

Mr. BAROFSKY. Our most significant challenge is hiring and the 

expanded hiring authorities in S. 383 are essential to us as we 

build our office. We are a temporary agency. We exist as long as 

the government holds an asset and while that may appear right 

now to be a long time, to attract government, highly trained government employees. And we need government auditors, we need 

government-trained investigators, and we need pretty sophisticated 

ones, at that, who have this type level of experience. 

The bottom line is that those who have that experience, particularly mid-career people, it is very difficult to recruit them into a 

temporary agency. I have had folks say to me, ‘‘Neil, what happens 

in 10 years? If your program is over, what happens to me and my 

career?’’ And those are difficult questions to answer. 

11 

These hiring authorities help us immediately address those questions. One, the ability to rehire annuitants. Those are, you know, 

highly experienced auditors, investigators who are retired and 

drawing a pension. And normally if they come back to government 

service, they have to have an offset for their pension. What the legislation does is gives us a waiver so they don’t have to do so. 

This is a method about which I had talked to some start-up special inspectors general, Iraq reconstruction, Director of National Intelligence, and they have told me—they had blanket authority 

under this provision. And they told me it was absolutely essential 

of getting people in place and in place quickly. This bill gives us 

actually a much more modest form of that, only 25 slots. 

And then the second part is under part of the U.S. Code 3161. 

That enables us to hire people, but they retain the right to return 

back to their Federal agency. So it helps answer those two questions. 

We can’t hire untrained new entry level people. We don’t have the time or luxury of time. We have $2.85 trillion to oversee and 

we desperately need to get a core group of investigators and auditors in as quickly as possible. 

Chairman MOORE OF KANSAS. Thank you, sir. 

Mr. Dodaro or Professor Warren, would you care to make any 

comments on how the bill might positively or negatively affect the 

broader TARP oversight effort and do you have any concerns with 

the bill? We have about 1 minute and 30 seconds left. I’m going to 

adhere to the time limits we have, so please, if you would— 

Ms. WARREN. I’ll yield to you, Gene. 

Mr. DODARO. Yes. Thank you, Elizabeth. 

I think I have no concerns with the bill. I think the provisions, 

especially the personnel provisions, are essential. I have the authority, as the Comptroller General, to waive the annuity offsets 

for retired annuitants. I have brought back about 80 people over 

a period of time, not specifically for TARP, but we have brought 

back one banking specialist for that purpose, and I think those 

tools are essential and I think it will help the overall oversight effort. 

Ms. WARREN. And I should just add, we have no concerns either. 

We support the bill and think it is important to move it quickly. 

Chairman MOORE OF KANSAS. Thank you, Ms. Warren. 

Last question, mine. We have about a minute left here. In your 

testimony, Mr. Barofsky, you note that with the Administration’s 

new financial stability plan, the TARP program expands to 8 different programs with an exposure of more than $2.8 trillion. 

One concern I have is in the oversight of TARP funds that pass 

through the Federal Reserve, especially given the independence 

Congress grants the Fed. For example, the Fed’s TALF program 

will use TARP funds to lend up to $1 trillion to thaw the consumer 

lending markets. 

Starting with Mr. Dodaro, what oversight power does your organization have over the Federal Reserve and do you have any concerns about tracking TARP funds passing through the Fed? 

Mr. DODARO. Actually, at the Federal Reserve, that is one of the 

very few areas that we are statutorily prohibited to look at as it 

relates to foreign transactions, open market transactions. 

12 

Chairman MOORE OF KANSAS. You said prohibited? 

Mr. DODARO. We are prohibited to. 

Chairman MOORE OF KANSAS. Okay. 

Mr. DODARO. We have the authority, Mr. Chairman, to look at 

how the Federal Reserve oversees and carries out its supervisory 

and review functions, but when it comes to monetary policy, particularly the discount window, open market operations, the decisions of the open market committee, and the transactions with foreign banks and foreign governments, GAO is statutorily prohibited 

from reviewing those activities. Now as to the TARP— 

Chairman MOORE OF KANSAS. Excuse me, sir. I’m over my time 

limit here. 

Mr. DODARO. I’m sorry. 

Chairman MOORE OF KANSAS. And I’m going to adhere to the 

time limits. If you would, please, if you have further comments to 

make, I would certainly appreciate receiving that in writing and I’ll 

circulate your comments to the other members of the committee as 

well. 

Mr. DODARO. I would be happy to. 

Chairman MOORE OF KANSAS. Thank you, sir, very much. 

I am out of time so I am going to recognize Mrs. Biggert now for 

her questions. 

Mrs. BIGGERT. My microphone didn’t seem to be working very 

well, so I’ll use this one. Maybe we have some money in the stimulus for updating this room. It could use a little help, I think. 

Thank you. 

Mr. Barofsky, once your office is fully staffed, and maybe you can 

tell us about how long that is going to take, do you plan to do an 

audit of the past recipients of TARP funds or will you focus on future recipients only? 

Mr. DODARO. Right now, our current audit of TARP recipients 

applies. Everyone up until the date that our letters went out. So 

we are going to be reviewing the use of funds of each and every 

TARP recipient up through February 4th, 5th, and 6th, I believe 

it is. 

Mrs. BIGGERT. So that will go back to the fall of 2008? 

Mr. DODARO. Back to the first disbursement, I think, in late October. 

Mrs. BIGGERT. And about how long is it going to take you to be 

staffed up? 

Mr. DODARO. To staff up? Well, hopefully if this bill is quickly 

passed, that will help us speed our hiring efforts. What I have done 

basically to date is I focused on the senior executive staff and I 

have now finally have—we have identified the right people. I’m 

very proud of the people that I have identified in the senior positions. Now they are going to be building out their different divisions. I’m hopeful with this expanded authority, we will be able to 

move more quickly than we have. 

Mrs. BIGGERT. Thank you. Then, Mr. Dodaro, in response to a 

critical report that your office issued in January regarding the 

Treasury’s management of TARP, Treasury developed the Financial Stability Plan that you have talked about and conducted a survey of the 20 largest TARP recipients and announced plans to anaVerDate Nov 24 2008 16:20 Jun 08, 2009 Jkt 048676 PO 00000 Frm 00018 Fmt 6633 Sfmt 6633 K:\DOCS\48676.TXT TERRIE
13 

lyze data each quarter from every institution receiving TARP 

funds. 

And in your written testimony, you mentioned that additional action is still needed from Treasury to ensure accountability. What 

are your recommendations and have you ever seen the data that 

they were going to analyze? 

Mr. DODARO. Yes. We now have the data from the 20 largest institutions. We are in the process of analyzing that information ourselves and we will be providing our analysis in our next report due 

next month. 

What we had suggested, though, is for the other institutions, 

which are now up to 416 institutions that have received money, is 

that rather than have the quarterly call report data, which is what 

they are planning to do, that they have the same monthly type survey, and maybe even a subset of information, that they can gather 

each month on the lending activities for those other institutions. 

We think it is important to have timely information from those 

institutions and we are very pleased with what we have seen on 

the monthly survey for the 20 largest banks, that they are actually 

collecting some information that is not on the quarterly call report 

data concerning different types of lending activities. So that is 

what we recommended. 

Mrs. BIGGERT. Okay. Thank you. 

Then Professor Warren, in your best estimate, or estimation, why 

has the Treasury Department either been unwilling or unable to 

give specific details as to how they manage the TARP program? 

Ms. WARREN. Congresswoman, I don’t know. I wish I had a better answer. I’m sorry. 

Mrs. BIGGERT. Do you think it is understaffing, inexperience, or 

that they just don’t want to do it? 

Ms. WARREN. I have no reason to believe that they don’t want 

to. At least we can say now there has been a shift, as we have new 

leadership in the Treasury, and they have made it clear, at least 

in their public statements, that accountability and transparency 

are important. They have made some significant changes on the 

Web site. They have implemented some of the procedures that the 

GAO has asked for. So there has been movement. My sense is, it 

is a very difficult time for them. 

Mrs. BIGGERT. You know, in reading the testimony of all three 

of you, I think there was something that you all talked about—a 

vision—needing the communication and the vision. It seems like 

with all of the things that have been done, there is no plan. I 

mean, it is we will do this and then we are going to do this and 

then we will do this and then we will go back and do this. Is that 

a problem or is it maybe due to their sensitivity in the marketplace 

and they don’t want to bring these out? 

Ms. WARREN. Congresswoman, I actually think it is worse than 

you have described it. I think it is worse than just that there has 

been change. Change can be explained by events unfold and if you 

discover that moving in this direction is not yielding in what you 

want, you move in another direction. 

What we saw I think with the valuation report, for example, was 

a description of a plan to go in one direction and a plan that was 

never designed to go there, an execution that headed in a very difVerDate Nov 24 2008 16:20 Jun 08, 2009 Jkt 048676 PO 00000 Frm 00019 Fmt 6633 Sfmt 6633 K:\DOCS\48676.TXT TERRIE
14 

ferent direction. And so this suggests a lack of forthcomingness on 

the part of Treasury, at least in the early months, that is deeply 

disturbing. And I have to say, it is critically what oversight is 

about and we can’t execute on oversight if there is not a clear plan 

to measure against the particular execution. So we are doing our 

best here, Congresswoman. 

Mrs. BIGGERT. Thank you. 

I yield back. 

Chairman MOORE OF KANSAS. Thank you to the witnesses and 

Mrs. Biggert, thank you. 

And next Mr. Lynch, you have 5 minutes, sir and I will tap at 

the end of 5 minutes so you wind up, if you would, please, very 

quickly. 

Mr. LYNCH. All right. Thank you, Mr. Chairman. 

First of all, I want to thank the witnesses for your work. I know 

this is not easy. Just for the record, I want to say that I voted 

against the TARP and I have not had a moment when I have regretted that decision, unfortunately, because of the way it has been 

run. 

I would say that how we handle this going forward is not only 

important because of the huge sums that are at stake here and the 

trust of the American people that must be regained, but also I’m 

hearing rumblings that the financial services industry is going to 

come back on the Hill, at some point, and look for more help. 

I just need to say that—and I have talked to a lot of my colleagues, although I only speak for myself, the risk appetite here on 

the Hill, given the way we have seen this top handled so far, is 

very, very low. And, you know, there is a whole lot more oversight 

that needs to happen and protection of the American people and 

the taxpayer that needs to happen here, work that you’re doing, before that will ever get through Congress. As much as it may be 

needed, I just think that this has been a disaster. 

Before I just ask my question, I do want to say that, Mr. 

Barofsky and Mr. Dodaro and Ms. Warren, in talking about the 

employees that might be needed to really do very good oversight, 

I know that many of our districts, we have Treasury offices closing, 

IRS offices closing. You have investigators, you have accountants, 

you have, God forbid, attorneys, you have auditors who are all 

doing this work and they are experienced, seasoned employees, in 

many cases, and offices are closing down. 

So there is a pool of talent there that I think we could capitalize 

on. You know, they would be doing the work that they are doing 

anyway. Some of them may be a few years from retirement and we 

might be able to tap into those resources so that we don’t have to 

go out and try to hire these folks from the private sector, which 

would be enormously expensive, I think. 

Let me ask you this. Normally, Congress wouldn’t need to know, 

in great detail, the make-up of complex derivatives or exotic derivatives or CDO’s or, you know, credit default swaps, but unfortunately, now the taxpayer is a major purchaser of these instruments. They are very complex and I have been trying on my own 

and with the help of the committee to get behind some of these instruments and see what is actually behind them. 

15 

You did wonderful work on the February report and, you know, unfortunately, we had bad news—the taxpayers overpaid, by $78 

billion, for some of these instruments. Are we ever going to get to 

the point where we are ahead of this process? And I was happy to 

receive the report, but it was after the fact. We had already overpaid, you know, 66 cents for every dollar, you know, we got back 

66 cents for every dollar spent. 

Are we ever going to get to the point where we can actually, you 

know, in real time, understand that, through transparency, that we 

are paying a fair value for these assets? Is that a possibility because that is something that I’m trying to grapple with and there 

doesn’t seem to be a clear answer out there. Some of this is, you 

know, because of Treasury’s lack of cooperation, but it also is a result of the complexity of some of these instruments. 

Ms. WARREN. Congressman, I would say three things, I think, 

about that. The first one is, although the report that we issued is 

entirely retrospective, it talks about transactions that had already 

occurred, surely that report has been read by the Treasury Department and if that doesn’t sound a warning, then I don’t know what 

possibly could. And that is, someone will be watching and reporting 

on every dollar you spend. And I assume that will have a very sobering effect on a going forward basis. 

Mr. LYNCH. You would hope so. 

Ms. WARREN. I would hope so. The second thing is that this goes 

to the question of increased transparency, trying to get more of the 

documents, and so on, to be transparent so that we can move up 

in terms of—on time on being able to value. We have now created—this is the second thing that came out of our report. We now 

know how to do it. So if you try those transactions again, we are 

much more geared up in how to evaluate them in something closer 

to real time. 

And then there is a third point on it, and this goes back to the 

question of articulating clearly what we are trying to accomplish. 

If Treasury will be in the business of trying to explain in a clear 

way what it is trying to accomplish and how this is the strategy 

to get there, we actually may have a chance to be able to evaluate 

it in real time. 

Mr. LYNCH. All right. 

Chairman MOORE OF KANSAS. Thank you very much, Ms. Warren. 

Mr. LYNCH. Thank you. 

Chairman MOORE OF KANSAS. Mr. Lee. 

Mr. LEE. Thank you. 

I have a few different questions, but I heard some interesting 

testimony and I guess we can throw it up for grabs on who wants 

to answer some of these questions, but I’ll start with, actually, one 

specifically for Mr. Barofsky, because during your testimony, you 

had talked about the fact that we have a huge investment in taxpayer money done really over a relatively short period of time, and 

during this period, we are going to see incredible amounts of waste, 

fraud, and abuse, potentially tens of hundreds of billions of dollars. 

And I, for one, I am a new Member of Congress and obviously, 

I did not vote for the first TARP, but the second tranche. I, again, 

was against the fact, based on what I had been hearing, that we 

16 

were in a position where we knew enough to release the second 

half. I’m curious. In your mind, do you feel it was a prudent course 

knowing the fact that we really, in my mind, don’t have enough 

systems set up in place that it was prudent to release another $350 

billion into the marketplace? 

Mr. BAROFSKY. Fortunately, making decisions and determinations like that is not among my responsibilities. Our focus, of 

course, is now that the decision has been made, what can we do 

to make the right recommendations to avoid the tens or hundreds 

of billions of dollars of fraud, waste, and abuse. And the way we 

do that, as I noted, is by trying to work with Treasury, taking a 

look at the program and making the necessary recommendations so 

we can avoid repeating the problems, the past problems, of history. 

Mr. LEE. Well, then, I’ll get to it in another way. My concern, obviously, is making sure we do have the right staff, but I came from 

the private sector and one of the things that concerns me and 

alarms me, that the only sector in our economy that has grown 

over the, really over the last decade, is in the Federal Government 

and hiring of new Federal employees. And unless we get the private sector growing, this country is in trouble. 

So a potential solution, and I would like your thoughts, is you 

have talked about the challenges of hiring qualified auditors to 

come in here and immediately have an impact. We have hundreds 

of billions of dollars at stake. We have four of the leading private 

firms, be it Deloitte, Ernst & Young, KPMG, or 

PricewaterhouseCoopers. Does it make sense, because they could 

be used on a temporary basis, to come in, and then they are not 

government employees, can go back into the private sector of using 

them to do some of the auditing for us? I would like your comments 

on that or anybody in this room. 

Mr. BAROFSKY. We have been given the power to contract and we 

are exploring those opportunities. We anticipate getting some help 

on our use of funds survey of contracting private auditing firms to 

help us. 

Mr. LEE. You feel you may go in that direction. 

Mr. BAROFSKY. We most certainly will go in that direction with 

respect to being able to get this project done. We have also contracted with Deloitte to help us in our program management. 

Mr. LEE. That’s good to hear. One last question and whoever 

wants to, again, tackle this one. The fact that, and I have always 

found this in its—it doesn’t matter if it is a government business 

or a private business, but we have the bureaucratic overlap with 

the GAO, the new Office of Financial Stability within the Treasury, 

the Congressional Oversight Panel, and I believe there are seven 

other offices of inspectors general in other agencies. How do you 

guys mesh together to ensure that you are speaking, and in fact 

doing, what you were designed to do in the first place? 

Mr. DODARO. I will take first shot at this. First of all, there is 

no overlap between the Office of Financial Stability and the entities that are overseeing their activities. So that is not an issue 

there because that is the Treasury Department administering the 

program and we are overseeing that program. 

Now with regard to coordination, we each have some specialty 

areas. For example, we are the financial auditor of the Office of FiVerDate Nov 24 2008 16:20 Jun 08, 2009 Jkt 048676 PO 00000 Frm 00022 Fmt 6633 Sfmt 6633 K:\DOCS\48676.TXT TERRIE
17 

nancial Stability at the GAO and we have these responsibilities to 

coordinate. Now we had the luxury of being an already existing 

oversight entity with staff and we pooled our financial markets experts, our accountants, our lawyers, and our economists together 

and we have had to do relatively little hiring to get on the case 

right away, and then we have coordinated with them. 

As Neil mentioned—Mr. Barofsky—they are focused on the criminal investigative area. Neither one of our entities is doing that. We 

overlap in some of the areas on implementation of some of the programs that we are working together on coordinated audits, sharing 

information and as Ms. Warren mentioned, and I’m sure she will 

articulate, the Congressional Oversight Panel has some broader 

policy issues that they are looking at that we at the GAO are not. 

I have been involved in a lot of this across government and I think 

it is working very well here. 

Mr. LEE. Thank you. 

Chairman MOORE OF KANSAS. Thank you to the witnesses and 

thank you, Mr. Lee. 

Next, Mr. Klein, if you have questions, sir. 

Mr. KLEIN. Yes, sir. 

Chairman MOORE OF KANSAS. Five minutes. 

Mr. KLEIN. Thank you, Mr. Chairman. 

Thank you all for being here and participating, and for your 

work in this very important area. 

When we passed the bill, the big issues and the big reasons to 

pass it were expressed as an attempt to head off more failures of 

major financial institutions and also to free up the credit market. 

And it is very clear, despite what was said by many of the leaders 

of the major banks who came before us last week or 2 weeks ago, 

that despite what they are saying, they are laying out large 

amounts of money to large Fortune 100’s. I went home last week 

and heard over and over and over again from businesses, small and 

large; real estate, commercial, and residential, that this is not 

translating to our local markets. 

So one of the biggest things I keep hearing from people is, all 

right. Well, you’re talking about the second $350 billion and yes, 

you are probably going to, hopefully, and part of this conversation 

is, put all the necessary trappings in place, oversight, clear direction of what is supposed to be—what the money is supposed to be 

used for, but it takes me back to well, we are not prepared just to 

leave that $350 billion out there on the table without a further interest in making sure that that money gets spent to help ease the 

credit market. 

And can you share with us, maybe start with Mr. Barofsky, your 

thinking on what it is that we can do, as it relates in your research 

and oversight, with the current—and maybe it is a question of our 

policy, you have to come make some recommendations to us as 

Congress, and we come back and whether we do it after the fact 

or we have a lot of interest in these institutions, regulatorily and 

otherwise, to get them to take necessary steps to ease the credit 

market. 

That is the biggest problem that I heard right now out there. 

What can you do—these banks that took all this money, what can 

you do to start lending to reasonably, you know, unwritten borVerDate Nov 24 2008 16:20 Jun 08, 2009 Jkt 048676 PO 00000 Frm 00023 Fmt 6633 Sfmt 6633 K:\DOCS\48676.TXT TERRIE
18 

rowers. We are not talking about making bad loans. We are talking 

about solid, creditworthy people. Can you share with us some of 

your thinking on what you are seeing? 

Mr. BAROFSKY. I think a theme that all of us keep returning to 

is transparency and whether it is transparency for Treasury or it 

is transparency for those who have received the funds. The way we 

are trying to contribute to answer your question is by doing this 

audit on how are they using the funds. And GAO has recommended 

and Treasury is implementing its survey on lending and the effect, 

the impact of TARP on lending. Our survey is a broader one on 

overall use of funds. 

So we hope that by doing that and being able to report back to 

Congress, how the first, of the first tranche, the first 350 or so entities up to January 31st have spent the money, that we can give you 

that data and give you that answer and therefore, be able to make 

recommendations based on that hard data. 

Mr. KLEIN. Well, I want to just point out transparency is absolutely essential because we want to understand it, but is there a 

gap here or is there a lack of standards, a lack of expectations, a 

lack of teeth that is missing from this original bill that said you 

take the money—the fact that they are going to end up reporting 

to us what they did or didn’t do with it may not solve the problem 

of how do we get this money to be put into the market for lending. 

Mr. BAROFSKY. I think the question of what conditions are attached is certainly, you know, a policy-based decision that needs to 

be addressed to meet your concerns. I think that the Administration has indicated, in its announcement of the programs, that there 

may be more requirements on how the institutions use the funds. 

We will see as those programs are rolled out. 

Mr. DODARO. A couple of points I would add. First of all, there 

is about $50 billion of the first amount of money, the $350 billion 

figure, that hasn’t been allocated yet to the banks. There are still 

dozens, if not hundreds, of institutions in the pipeline that the regulatory agencies are looking at and making recommendations to 

Treasury. 

A second major point is, you know, we made recommendations 

that those entities provide monthly reports on their lending activities and Treasury hasn’t implemented that recommendation on the 

first half. They’ve indicated that they would look at it for the second half. We still think that needs to be put in place. 

Mr. KLEIN. And that can be done right now. 

Mr. DODARO. They would have to renegotiate the agreements. 

The ones that they haven’t executed yet, they could still do it and 

it could be done. 

Mr. KLEIN. Mr. Chairman, I think that is something we ought to 

be speaking to Treasury about. I mean, as we want transparency, 

there is no reason we can’t go back on the original money that was 

allocated and get these institutions to participate with us. 

Chairman MOORE OF KANSAS. I agree with you. 

Ms. Warren? 

Ms. WARREN. I would only add to that, Congressman, that I 

think you are exactly right about this, but this goes back not only 

to transparency, but to about clearly delineated goals. If this is 

about putting money into the hands of small businesses that have 

19 

done most of the job creation outside the public sector, then you 

make that part of the terms of taking the money. And if someone 

doesn’t want to do that with the money, then don’t let them have 

the money. It’s that straightforward. 

Mr. KLEIN. I know my time is running out, but I think that is 

a very important point. I know our small business community, 

which we are all so concerned about, is not getting access to this. 

Large businesses are, in many cases, but, Mr. Chairman, I think 

we really need to focus on getting some criteria, if they receive 

money, small businesses are given high level focus. 

Chairman MOORE OF KANSAS. Thank you, Mr. Klein, and thank 

you to the witnesses for that, the questions and answers. 

And the last person who has indicated they have questions to ask 

is Mr. Paulsen. Sir, if you would. 

Mr. PAULSEN. Thank you, Mr. Chairman, and I also want to 

thank the witnesses for taking the time to testify. 

I will just ask a quick question. Mr. Barofsky, I understand your 

offices are currently held in the Treasury Department, right? And 

that being the case, you are not technically part of the Treasury 

Department, obviously. You don’t ultimately answer to the Treasury Secretary. You are kind of on your own, but whom exactly do 

you ultimately answer to just in regard to your findings, your oversight. Is it just reporting back to us? I mean, sort of your authority. 

Who do you have to go back to and report your findings? 

Mr. BAROFSKY. I think you are correct. We answer to you, the 

Congress. 

Mr. PAULSEN. And I just want to follow-up, Mr. Chairman, too, 

with Ms. Warren. 

You had mentioned before and, you know, both Mr. Dodaro and 

Ms. Warren had mentioned earlier that the oversight and reports 

that have come out have been very critical of the process in terms 

of re-reporting the same problem over and over again. 

And so, what sort of hope can you give us, I mean, that you are 

not going to re-report once again the same problem because I think 

you are hearing this frustration across the aisle here today, but it 

is—as you mentioned before, it is disturbing, there is no clear plan 

to measure against as the execution goes forward, but is there hope 

that we can really buck the trend and do something differently, as 

these monies go out there, for the confidence of taxpayers? 

Mr. DODARO. I think that is a good question to ask the Secretary 

of the Treasury in the Treasury Department. I mean, our recommendations are advisory. They only have a force of law if Congress requires them, through statute, to be implemented. Treasury 

has been implementing our recommendations at the GAO, but they 

have not fully implemented most of the recommendations that we 

have had. So unfortunately, in these circumstances, unless the 

agencies fully implement the recommendations, we will be repeating them going forward because we think they are important. 

Chairman MOORE OF KANSAS. Thank you. I was wrong. We do 

have a couple of other members who would like to ask questions. 

First, Ms. Speier, please, for 5 minutes. 

Ms. SPEIER. Thank you, Mr. Chairman and members. 

First of all, let me say to all three of you how important your role 

is as we move forward on assessing TARP. You are our eyes and 

20 

ears and if there is one frustration I think we all have it is that 

we don’t get the word soon enough when there is trouble to be able 

to change it midstream. So anything you can do to alert us with 

your red flags, I hope that you will do that, and we will attempt 

to act more quickly. 

Mr. Barofsky, you said that you have received 17 responses and 

you have made 350 requests. My understanding is that these are 

voluntary, so they don’t have to return these responses. 

Mr. BAROFSKY. That’s correct. 

Ms. SPEIER. Okay. That is enough to send me into orbit and 

probably every American taxpayer. What do we have to do to make 

sure that everyone who has received TARP money is required to respond to you? 

Mr. BAROFSKY. Well, I think that—I’m hopeful that we are going 

to have a full compliance. It is a 30-day deadline so I was actually 

surprised that we got responses this early. We obviously, we do 

have the power to compel responses if people choose not to and I 

will talk to my audit staff and depending on what our level of response rate is, we certainly can consider compelling them through 

a subpoena— 

Ms. SPEIER. So you do have the authority to compel them. I, as 

one Member, would want you to do utilize and exercise that authority if they do not and I would like for you to start posting on 

your Web site those who have so that we can see who hasn’t responded and who has responded as a running total, if you would. 

Mr. DODARO. I think we are certainly going to post response 

rates and that information— 

Ms. SPEIER. But I would like to know who hasn’t responded as 

opposed to who has. 

Mr. DODARO. I am confident that is part of our audit plan. 

Ms. SPEIER. All right. Thank you. 

Ms. Warren, I have to tell you, I think you are doing an incredible job with a very small staff. So my first question is, do you need 

more support to do your job? 

Ms. WARREN. Yes, but we are working on it. We are expanding, 

we are moving from tiny to small. Well, that’s good. And we are 

hiring. I will say, and I say this very tentatively, we would also be 

delighted to have the opportunity to hire those who are— 

Ms. SPEIER. Retired annuitants? 

Ms. WARREN. Retired annuitants. I don’t want to do anything to 

slow up the bill that is in progress for the IG, but it would help 

us, as well, as we are trying to expand and staff out for our oversight procedures. So I mention that, but I do it with trepidation, 

not wanting to get in the Inspector General’s way. 

Ms. SPEIER. All right. Well, we will see what vehicle we can use 

to assist you in that. 

Your report that basically made the case that we were shortchanged in the original contracts that were made with the banks 

is pretty astonishing. And when the CEOs of the banks were at a 

hearing last week, I actually referred to your report and since you 

have received a subsidy from the taxpayers of $80—was it $80— 

Ms. WARREN. $78 billion. 

Ms. SPEIER. —$78 billion— 

Ms. WARREN. More or less. 

21 

Ms. SPEIER. —what would you give back to the taxpayers. Would 

you reduce your credit card interest rate? Not one of them said yes. 

So I guess my question to you is, what should we extract from 

these TARP recipients who have gotten deals that really are too 

good to be true? 

Ms. WARREN. Well, Congresswoman, I think this is exactly the 

right question and I will say, as Mr. Dodaro did, the right person 

to put on the stand for that question is the Treasury Department 

that has the authority to ask for more, indeed to demand more, not 

only from those who receive money in the future, but from those 

who have already received taxpayer dollars. 

Ms. SPEIER. So in the contracts, and you have reviewed them, I 

gather— 

Ms. WARREN. Yes, ma’am. 

Ms. SPEIER. —is there the opportunity, then, to rewrite them to 

add more provisions? There is nothing that prevents us from going 

back and creating more— 

Ms. WARREN. Yes, Congresswoman, that’s right. 

Ms. SPEIER. Now my time has almost expired, but there was a 

Citigroup contract that was discussed at our hearing that was pretty astonishing—I don’t know if you are familiar with it—where we 

basically are committed to over $300 billion over the 10-year period 

of time of $306 billion of losses. Do you have any insights on that 

contract? Are there more contracts as bad as that contract that we 

should be aware of and bring to light? 

Ms. WARREN. Congresswoman, I actually want to start by making a point. When we did the analysis of the value of what the 

American taxpayer got back in return for the money that it had invested into the banks, we deliberately did not count the guarantees, which means that our $78 billion is small relative to potential 

exposure. We might also want to take a look at the Bank of America transaction and some others that involve guarantees. 

Ms. SPEIER. Thank you. 

Chairman MOORE OF KANSAS. Thank you, and I would—before 

we call on the last member to ask questions, I would like to note 

that Mr. Lynch had to leave for another committee hearing. There 

are other hearings going on and members sometimes belong to 

multiple committees and I know some other members may be not 

here for that reason as well. So I just wanted to let the witnesses 

know that. 

And Ms. Kilroy, you are the last person to ask questions here 

today. 

Ms. KILROY. Thank you very much, Chairman Moore. Thank you, 

panel, for being here this afternoon. I appreciate all the work that 

you have been doing in helping us get a handle on this oversight 

issue. 

You know, it seems to me, in the news reports again today, that 

some of the TARP recipients still haven’t gotten the message that 

the party is over. And it seems that perhaps the statement that 

you made, Professor Warren, about making sure that there is a 

clearly delineated goal, maybe some of the responsibility lies in 

how things have been drafted in the first place in terms of delivering that message in a much stronger fashion than has certainly 

been received to date. 

22 

So I want to follow-up on what Mr. Klein was asking with respect to, you know, should there be more legislation in TARP? 

Should that be where we should be coming down harder and making sure that we have the clearly delineated goals. Have we given 

Treasury, in the granting of substantial discretion, maybe too much 

discretion in how to fashion the TARP agreements? 

Ms. WARREN. I think this is a very tough question, Congresswoman, which obviously it is your job to ask tough questions, but 

the point here is that I understand why one might design a system 

with a lot of flexibility, you know, that you don’t just stand behind 

somebody putting out a fire and try to micro-manage how that happens. But I also understand that if you are going to give that much 

discretion, that it comes with great responsibility to be forthcoming 

to Congress and to be forthcoming with the American people about 

every step of the way. 

And so I think the real question here is first, does Treasury have 

the message and second, do you have real alternatives for how you 

want to think about the management of this economic crisis because if Treasury is heading in a particular direction, whether they 

articulate it clearly or not, there is only meaningful oversight if you 

could understand it and say, so what would have our alternatives 

have been? Should we be doing something different with the financial institutions? Should we be doing something different about 

mortgage foreclosure mitigation? 

If there aren’t alternatives on the table that you focus on and 

clearly study, then there really is no alternative. You are legislating in the dark. In part, I see that as the responsibility of the 

Congressional Oversight Panel. We are here partly to wave the flag 

when there is a problem, to try to document that and show you the 

seriousness of it, but we are also here to try to bring you some 

ideas about alternatives. 

Whether we keep that on an informal basis in the sense that we 

come, we testify, we meet with you, or a more formalized basis, 

that this is the direction you want to go with reigning in the Treasury’s ability to decide its own fate, as it goes forward, and the fate 

of the economy, that will ultimately be the decision for Congress. 

So I think the answer in part—I hope what I’m trying to say 

here—is we need a lot more intensive conversation about this and 

it is a conversation that is informed by the facts of what they have 

done, by whether or not they are willing right now to articulate the 

direction they are going in and our ability to evaluate whether that 

direction makes any sense. 

Ms. KILROY. As you know, the House passed some additional 

teeth for TARP money that was not taken up by the Senate and 

I do hope that despite the fact that the Senate didn’t take it up, 

that Treasury does take that into account and that we see those 

standards in any future TARP agreements. 

I was also stunned by the testimony about the potential for fraud 

and want to follow-up with that. You talk about the need for baseline fraud prevention standards. Are these in existence now in the 

right places to make sure that you have the framework that then 

you can go and enforce if there are instances that any number of 

these whistle blowers might bring to your attention? 

23 

Mr. BAROFSKY. Well, we are certainly reaching out to whistle 

blowers. Our Web site is up and running, our hotline is up and 

running, and a lot of what I have been doing in the first 2 months 

of our existence is building that framework. And a lot of that is 

through our relationships. 

Given our relatively small size and obviously the vast amount of 

money that we are responsible for overseeing, I have spent a lot of 

time working with the Department of Justice, with the FBI, with 

State attorneys general, and with the SEC. Basically any law enforcement out there that could potentially assist us in monitoring, 

deterring, and then investigating and prosecuting fraud, we have 

been out there and we are working on those relationships. And I 

think we are getting the right structure in place, particularly with 

these programs that are coming out now. 

Ms. KILROY. But if the initial legal framework or TARP documents aren’t set up the right way, there would— 

Chairman MOORE OF KANSAS. Your time is up. 

Ms. KILROY. Thank you, sir. 

Chairman MOORE OF KANSAS. Mrs. Biggert and I have discussed 

the possibility of each member who wants additional time to ask 

questions, we can do that and I would start—I have a question myself and we will just go through very briefly, if that is okay with 

the witnesses as well. 

The Fed’s TALF program will use TARP funds to lend up to $1 

trillion to thaw the consumer lending markets. Starting with Mr. 

Dodaro, what oversight power does your organization have over the 

Federal Reserve? Do you have any concerns about tracking TARP 

funds passing through the Fed? 

Mr. DODARO. As I was starting to mention before, to the extent 

that the Federal Reserve is using monetary policy, discount window 

operations, and open market decisions, we are prohibited by law 

from reviewing those activities. Now so as the TARP program and 

Treasury begin to have these partnerships with the Federal Reserve, there may be some limitations on our ability to provide that 

type of oversight. 

We are studying how best to do that, this activity, the expansion under the TALF program, from the $20 billion up to $100 billion 

of TARP funds to leverage against the trillion, is a new development. 

So we are taking a look at that. The program hasn’t started yet. 

We are trying to figure out how best to do it, but it is something 

I’m concerned about, Mr. Chairman, and I will come back to the 

committee. I was asked when we testified before the full committee, you know, about this issue. 

Chairman MOORE OF KANSAS. Ms. Warren or Mr. Barofsky, any 

comments? 

Ms. WARREN. I’ll just point out that because our work is much 

more a policy and sort of direction, although we are statutorily authorized and required to see what is happening in the expenditure 

of TARP funds, it is not possible to look at that without looking at 

what the Fed is doing as well. So we regard that as within the 

range of the policy questions and issues that we should be looking 

at. 

Chairman MOORE OF KANSAS. Any comments, Mr. Barofsky? 

24 

Mr. BAROFSKY. Mr. Chairman, TALF, obviously, was a focus of 

our recommendations in our initial report to Congress. I continue 

to be in touch with the Federal Reserve, as well as Treasury, about 

recommendations we have made regarding the TALF. I anticipate, 

and we are currently putting together, a group to make sure that 

we are going to have effective oversight of the TALF, certainly from 

a criminal perspective, to make sure that we can deter, as well as 

investigate and prosecute. 

Chairman MOORE OF KANSAS. Thank you. And that is all the 

questions I have. 

Mrs. Biggert, do you have additional questions? 

Mrs. BIGGERT. Thank you. 

And actually something along that line, Mr. Barofsky, you talked 

about the TALF program in your report on February 6th about 

using asset-backed securities as collateral. You were concerned 

about that and you had recommended that there be minimum underwriting standards and/or fraud prevention mechanisms. What 

were your recommendations as far as those standards? 

Mr. BAROFSKY. Well, our initial concern as the TALF program 

was first described, the basic fraud prevention was reliance on 

credit rating agencies and the due diligence of investors. And I 

think history, recent history, has demonstrated that we should not 

be relying on credit rating agencies and private investors. That is, 

of course, in a different type of asset-backed security, not what was 

originally intended for the TALF, but in the mortgage-backed security market, obviously those failed. 

So our original recommendations were addressing the program 

as initially determined and we suggested increased underwriting 

baseline as one example of a fraud detection or prevention mechanism. Since then, we have had a number of discussions with the 

Federal Reserve. They presented to us a number of potential areas 

they may go when the TALF is rolled out, I think likely this week 

or next week based on what Chairman Bernanke said earlier today, 

and we are hopeful that there will be vastly improved fraud prevention protections in there. 

Mrs. BIGGERT. I have had an amendment to several of the TARP 

bills and probably will try and have another amendment on this 

bill, and that would be to have more prosecutors from the Department of Justice and more investigators from the FBI for mortgage 

fraud. Would you be in favor of that? Is that something that you 

think we need now or is that— 

Mr. BAROFSKY. I recently testified in front of the Senate Judiciary Committee on several bills, one by Chairman Leahy and another one by Senator Schumer, addressing specifically increased resources for the FBI and for the U.S. Attorney’s Office and the Department of Justice. I think it is absolutely vital with not just the 

TARP-related programs, but the shift of Federal law enforcement 

resources since September 11th, out of white collar criminal prosecution and to terrorism, that there really is a need to restock the 

FBI. 

Mrs. BIGGERT. Can you outline specific fraud protections that you 

would recommend? 

Mr. BAROFSKY. It really depends on the program. 

Mrs. BIGGERT. For TALF. 

25 

Mr. BAROFSKY. For TALF, I think one of the key areas that we 

made recommendations is on the front-end, certain requirements 

and testing of the borrowers and the actual underlying assets. In 

other words, making sure that the assets, the collateral that backs 

the asset-backed securities, whether it is an auto loan or a student 

loan, making sure that they are real, that they are properly underwritten, so we don’t get back into the same situation as we did 

with the mortgage-backed securities. 

We have had really difficult troubled assets that back these securities that are not triple A rated and if the Treasury ends up holding these assets and it finds out that they are not what they appear to be. And I think one of the things the Federal Reserve is 

addressing is exactly that, is testing of the assets that backed the 

securities to make sure that they are real and they meet the criteria. 

Mrs. BIGGERT. Thank you. Then just one more follow-up question, if I might. With the Administration changing course yesterday 

and announcing that it would allow financial institutions to sell 

government common stock as opposed to preferred stock, does the 

riskier nature of common stock concern any of you from an oversight standpoint? 

Ms. WARREN. Well, common stock is valued differently because 

of the riskier nature. It also means, in the case if we are doing— 

we are taking what had been preferred and moving it to common 

stock, we are forfeiting certain payments, a stream of revenue that 

would have come in under the preferred. 

It also means we are moving now into a plan that is hard to describe because we are not clear what kind of control is going to 

come with the common stock. We know how it works in the private 

market, but when the government is the holder of large portions 

of the stock, but there are still private holders, this raises a whole 

new set of questions. We have an animal that will be neither fish 

nor fowl. 

Mrs. BIGGERT. Absolutely. I agree with you and I hope that you 

will make your concerns known to the powers that be. Thank you. 

I yield back. 

Chairman MOORE OF KANSAS. Thank you to the witnesses and 

to Mrs. Biggert. 

And next, Ms. Speier, you have an additional 5 minutes of questions. 

Ms. SPEIER. Thank you. 

What percentage of the TARP funds, in your review, has been 

loaned out? Do you have a figure? 

Ms. WARREN. Well, we know that about $300 billion has gone out 

the door and then there are commitments, now, for— 

Mr. DODARO. For the remaining $50 billion. 

Ms. WARREN. —$50 billion of the first $350 billion. 

Ms. SPEIER. No, I—yes. My question is, of the money that has 

been received— 

Ms. WARREN. Oh, I’m sorry. 

Ms. SPEIER. —by the banks, do we have any idea what percentage of that money has been loaned out? 

Ms. WARREN. No. Congresswoman, if we don’t ask, we can’t 

know. 

26 

Mr. DODARO. That was the essence of our recommendation. That 

was our very first recommendation, they need the reporting back. 

And I think, you know, Mr. Barofsky’s effort is a good effort, but 

that shouldn’t substitute for the responsibilities of the Treasury 

Department to require that monthly reporting of all institutions receiving the money. And that is the recommendation we reiterated 

last month. 

We are glad they moved forward on the 20 largest institutions, 

but that won’t substitute for having information on all the institutions. That is the only way you are going to get timely information 

on a recurring basis. You can collect point and time information, 

but in this case, you need it on a continual basis. 

Ms. WARREN. And I would only add to that, since we have made 

the same point in our reports, it may be more than just reporting. 

If this is really what we want to accomplish, then we have to move 

to making it a requirement. 

Ms. SPEIER. Is there any concern about these no-bid contracts 

that have been let by the Treasury Department and if so, what 

would be your concerns? 

Mr. DODARO. On the no-bid contracts, we looked at that early on 

and we found that they had followed the Federal acquisition regulations. They had limited numbers of contracts. I think in our last 

report we said at the end of last calendar year, they had about $8 

million in contracts that they have obligated, but we have been 

looking at every contract once it’s done. 

Now what we did say is that they have been—while they are following the Federal acquisition regulations, they are using time and 

materials contracts, which are, as you know, are a riskier form of 

contract, and as their requirements become better known, they 

should move to fixed price contracts, which are less risky and a 

better protection for the taxpayer. In the meantime, they need people to oversee the contracts that they had let and we had a recommendation that those people be adequately experienced and 

trained properly. 

Ms. SPEIER. So it is time and materials with no cap. 

Mr. DODARO. There are some caps, I believe. We list them in our 

report. I would be happy to provide that for the record. 

Ms. SPEIER. All right. Thank you. How many more tools or what 

additional tools do you need? Besides the personnel, what kind of 

authority do you need that you don’t have presently that we should 

be guaranteeing that you get? 

Mr. DODARO. I think there are two issues from our perspective. 

One, we have mentioned here in terms of to the extent to which 

that the Congress wants oversight from the GAO and the Federal 

Reserve activities, there would need to be a legislative change. Now 

historically, the Congress has not done that to protect the independence of the Federal Reserve and I’m not suggesting that it be 

changed on an ongoing basis, you know, for normal circumstances. 

We clearly are not in a normal circumstance at this particular 

point in time. 

And so to the extent to which the Congress wants to do that, we 

would be happy to work on some, you know, specifically tailored 

authorities to carry out that responsibility. Now we are going to try 

27 

to work as best we can under the current framework, but there are 

clear limitations on our ability that need to be changed in statute. 

There is also a bill in the Senate—S. 340—that would provide 

GAO access to all TARP recipients’ funds. And, you know, while it 

hasn’t been a problem so far, particularly since Mr. Barofsky’s organization is getting split up, where the government goes in the future with the second $350 billion, we are not clear about that. 

We have been working to try to get our access into agreements 

and Mr. Barofsky has been very helpful to do that. Say, for example, in the auto makers, and we are now looking at the auto makers plans. But in the future, it is not really clear who all the recipients would be. So that would be an important safeguard if that legislation was enacted as well. 

Ms. SPEIER. Ms. Warren? 

Ms. WARREN. I would say only two things that you just should 

be aware of. It has not yet created a problem for us, but our—we 

are still developing in what we are doing and asking for. The first 

is I note we do not have subpoena power. We are the only one of 

the three who can hold hearings, but whether or not someone 

wants to come is entirely up to them. 

The second thing I would note is that we have the authority to 

ask Treasury for information, but if Treasury has not gathered that 

information, they can, quite truthfully, say to us, we don’t know. 

We do not have the authority to ask the financial institutions 

themselves for information. And so these are areas in which we 

may be able to do more if we had more authority. 

Chairman MOORE OF KANSAS. Thank you. And I would like to, 

again, thank our witnesses for their testimony today. 

And to the members who participated in today’s hearing, I appreciate that as well. I think this hearing and hearings like this in the 

future will be very important and I look forward to working with 

the members on both sides of the aisle. We need to do that. 

I think today’s hearing gives us a better sense of the oversight 

that is going on regarding the use of TARP funds and how it can 

be improved to ensure the program is transparent and closely monitored. I look forward to working with our witnesses and with my 

Republican and Democratic colleagues to ensure TARP recipients 

will be held accountable and U.S. taxpayers are protected. 

The Chair notes that some members may have additional questions for this panel, which they may wish to submit in writing. 

Without objection, the hearing record will remain open for 30 days 

for members to submit written questions to these witnesses and to 

place their responses in the record. 

And again, I appreciate everybody’s participation. This is very 

important work and we will have more hearings like this. Thank 

you so much and the hearing is adjourned. 

[Whereupon, at 4:00 p.m., the hearing was adjourned.] 

(29) 

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