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Treasury Department Challenges Independence of TARP Inspector General
June 18, 2009 12:02 PM
ABCNews’ Jake Tapper & Matt Jaffe report
The Obama administration’s disputes with government watchdogs do not end with fired Inspector General Gerald Walpin. Behind the scenes, the Treasury Department is embroiled in a disagreement with Neil Barofsky, the watchdog for the $700 billion government bailout Troubled Asset Relief Program, or TARP.
The dispute was revealed in a letter that Sen. Chuck Grassley, R-Iowa, sent on Wednesday to Treasury Secretary Tim Geithner, first reported by the Los Angeles Times’ Tom Hamburger and Peter Wallsten.
As part of his duties performing audits and keeping tracking TARP dollars, Barofsky asked the Treasury Department for some documents about a financial institution receiving tens of billions in taxpayer bailout dollars. The Treasury Department refused to hand them over, “on a specious claim of attorney-client privilege,” Grassley wrote. “It is my further understanding that this disagreement then escalated into broader questions about whether SIGTARP is subject to your direct supervision and direction, which may have been referred outside Treasury for an independent legal opinion.”
“The ability of Inspectors General to secure agency records subject to audit or investigation is essential to ensure the integrity and reliability of their work on behalf of Congress and the American People,” Grassley wrote. “The Inspectors General were created by Congress as a means to combat waste, fraud, and abuse and to be independent watchdogs ensuring that federal agencies are held accountable for their actions.”
“We will review the letter and respond to the Senator before making comment as is our practice,” a Treasury official said.
Barofsky’s office had no comment.
The subject of the disagreement between Geithner and Barofsky remains unclear, but there is something of a paper trail.
In a memo dated April 7, Barofsky – referring to his office under the name SIGTARP, Special Inspector General for TARP -- clearly felt compelled to defend the independence of his office.
“SIGTARP believes that the Emergency Economic Stability Act of 2008…provides that SIGTARP is an independent entity within Treasury, that SIGTARP is not subject to the Secretary’s supervision, and that attorney-client privilege is not a bar to SIGTARP’s access to Treasury’s records or information,” Barofsky wrote to Geithner at the time.
In a statement, Grassley said, ”The grassroots is furious about the way TARP dollars have been used and what looks like a lack of accountability for this massive infusion of tax dollars. It’s added injury to hear about the Treasury Department putting up hurdles to slow down the work of the watchdog who’s supposed to track the money. One of the biggest lessons of the last year is that the public deserves more transparency and, in turn, accountability from New York and Washington.”
Barofsky is not the only inspector general who has been butting heads with the administration. Walpin, the former Inspector General of the Corporation for National and Community Service, was fired last week by President Obama, a move that incited criticism on Capitol Hill from both sides of the aisle, including from Grassley and Sen. Claire McCaskill, D-Missouri.
-Jake Tapper & Matt Jaffe
June 18, 2009 | Permalink | Share | User Comments (95)
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Well what is to be expected of Tax Cheat Tim Geithner and his corrupt masters in Tammany Hall. The White House clearly wants to hide the Chicago Blogo style payola Tax Cheat Timmy is funneling to his buddies under the table. I don't think I've ever seen such naked corruption before in my life.
Oh I guess that's what Obama meant by; "Change we can belive in."
Posted by: SPQR_US | Jun 20, 2009 5:55:28 PM
It's amazing that while the treasury and fedral reserve can colude to transfer 800,000,000,000 dollars from each of us and our children to the banks to ensure the bondholders who financed the subprime mess don't lose a dime, some of you idiots still think the important issue is republican vs. democrat. Wake up. The only resistance to this, the single greatest act of robbery of the middle class in the history of civilization, were a tiny few in congress. Any congressman who supported public law 110-343 (TARP) is either too stupid or dishonest to be a dog catcher, much less a congressman.
if you've read this far, consider googling lew rockwell or mish.
Posted by: casey riemer | Jun 19, 2009 9:15:45 PM
Hey, can you also being to light that criminal RAT committee that they slipped into the Stim bill that is designed to tell Inspector Generals who they can and CANNOT investigate while your at it?
Thanks
Posted by: Drider | Jun 19, 2009 1:44:29 PM
TARP is a COVER for Wall Street. Those funds have been used by the investment bankers to push-up stocks for the past few months. They were not used for "lending". Stocks have BLOWN UP 40% in just three months. TARP is a cover and Geithner does not want us to see what is underneath.
Posted by: amy nicole | Jun 19, 2009 9:37:35 AM
Geithner comes from the Federal Reserve Bank of New York. As a result, he (and the rest of the Fed crowd) is accustomed to secrecy. He has no real concept of "transparency". He's a dangerous and scary guy who happens to look like a boy scout. Not a good thing.
Posted by: tanya | Jun 19, 2009 9:28:42 AM
What crappy reportijng. It's a 'hit job', as they make it sound as bad as possible, referring to 'criticism from both sides of the aisle' - while nowhere noting that the one Democratic Senator they mention has since released a statement that she just wanted the administration to state a reason as the law required, they did, and she is now satisfied with their actions.
Oops, guess you forgot to include that, Jake, while trying for the Watergate reporting award. They also used the 'not just one conflict' section reducntantly in the article at the beginning and end.
Just to stoke the flames as hot as possible. Crappy reporting.
Posted by: Craig234 | Jun 18, 2009 11:14:43 PM
Ryan C | Jun 18, 2009 4:28:29 PM
strong
Posted by: Skip | Jun 18, 2009 4:31:50 PM
"btw, did Kerry ever release his military records? Not that they are needed to satisfy YOUR intellectual curiosity."
2005 - "Senator John F. Kerry, ending at least two years of refusal, has waived privacy restrictions and authorized the release of his full military and medical records."
The lack of any substantive new material about Kerry's military career in the documents raises the question of why Kerry refused for so long to waive privacy restrictions. An earlier release of the full record might have helped his campaign because it contains a number of reports lauding his service. Indeed, one of the first actions of the group that came to be known as Swift Boat Veterans for Truth was to call on Kerry to sign a privacy waiver and release all of his military and medical records.
But Kerry refused, even though it turned out that the records included commendations from some of the same veterans who were criticizing him"
Posted by: Ryan C | Jun 18, 2009 4:28:29 PM
The question here is wether or not the Obama administration is blocking their own edict on transparency!
WHY would the treasury try to claim "attorney-client" priviledge under any circumstances?
I do believe that all of us, left, center & right want to know where the TARP funds have gone and what was done with them.
Posted by: Mike_C | Jun 18, 2009 4:08:53 PM
Are you referring to the term 'swiftboating' becoming a negative in the lexicon? I don't think anyone saw that coming.
Posted by: Skip |
------------------
Like borking, eh.
btw, did Kerry ever release his military records? Not that they are needed to satisfy YOUR intellectual curiosity.
Posted by: Foghorn Leghorn | Jun 18, 2009 4:08:31 PM
"And out of context video pushed by the right wing is the "evidence""
LOL.....yeah, right...and Like "I did not have sex with that woman" was taken out of context!
Posted by: Mike_C | Jun 18, 2009 4:04:35 PM
Ryan C:"Considering the trouble 3 of them are having, is it valid to look into it and report on it?"
Sure
=============
Great! Then let's do that.
Posted by: MayBee | Jun 18, 2009 4:03:29 PM
"Over 200 actual vets who served their country over there are slandered and the one with a D after his name is the only one that mattered."
Are you referring to the term 'swiftboating' becoming a negative in the lexicon? I don't think anyone saw that coming.
Posted by: Skip | Jun 18, 2009 4:00:34 PM
"Changing the line of scrimmage mid game doesn't make the other team offsides. It's too bad the referees (MSM) act like they don't see it."
Kind of like blaming the economic crisis on Obama?
Don't worry, the American people blame Bush, they were not fooled by the goalpost moving of the right wing media.
Posted by: Ryan C | Jun 18, 2009 3:57:31 PM
===================
Deflection, deflection deflection. I expect no less from loyal partisans.
So whats up with Fannie/Freddie? LOL.
Posted by: Cryos | Jun 18, 2009 4:00:18 PM
"There is video of Barney Frank and other democrats saying FM/FM are sound."
roflmao!
And out of context video pushed by the right wing is the "evidence"
Posted by: Ryan C | Jun 18, 2009 3:58:52 PM
"Changing the line of scrimmage mid game doesn't make the other team offsides. It's too bad the referees (MSM) act like they don't see it."
Kind of like blaming the economic crisis on Obama?
Don't worry, the American people blame Bush, they were not fooled by the goalpost moving of the right wing media.
Posted by: Ryan C | Jun 18, 2009 3:57:31 PM
===They slandered an actual Vet who served his country over there ===
How does that work? Over 200 actual vets who served their country over there are slandered and the one with a D after his name is the only one that mattered.
Posted by: Axey | Jun 18, 2009 3:57:24 PM
"I love liberals use of the term "right wing." Republicans compromise on an issue taking a moderate stance and for the next round the compromise position becomes the "right wing" stance."
I use "right wing" to distinguish from Republicans.
For instance McCain, Lindsey Graham,. Coburn, etc.
These are Republicans.
Hannity, Rush and the morons like them in Congress (your Santorums, your Bachmanns) are right wingers.
Hope that helps.
Posted by: Ryan C | Jun 18, 2009 3:56:14 PM
"I pushed back on the common belief that the Swifties were liars."
They slandered an actual Vet who served his country over there [unlike those he was running against] for political reasons. It was one of the most shameful events in recent history.
Posted by: Skip | Jun 18, 2009 3:55:24 PM
I love liberals use of the term "right wing." Republicans compromise on an issue taking a moderate stance and for the next round the compromise position becomes the "right wing" stance.
Changing the line of scrimmage mid game doesn't make the other team offsides. It's too bad the referees (MSM) act like they don't see it.
Posted by: Cryos | Jun 18, 2009 3:51:39 PM
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