The $78 billion rip-off: Treasury overpaid for bank assets (TARP)
Posted Fri, Feb 6, 2009 at 7:53 pm
The Bush administration received assets that were worth $78 billion less than the amount it invested as part of the massive infusion of capital into the country's banks, congressional investigators have found.Earlier today, she hinted (link) the possibility that Paulson should be criminally charged with something at some point.
The investigators concluded that the Treasury under the federal bailout had invested $254 billion into companies but the preferred stock it got in return had a market value at the time of only $176 billion, or 69 percent of what the government paid, according to a congressional oversight panel report scheduled to be released today.
Elizabeth Warren, the chairwoman of the panel, said former Treasury secretary Henry M. Paulson Jr. had promised that the government would buy the assets at their market value and that it was alarming that he didn't do so. "At various points, Treasury has articulated policy objectives which could result in a program involved paying substantially more for investments than they appear to have been worth at the time of the transaction," she said in written testimony submitted to the Senate Banking Committee yesterday. "The American people want to know what's going on and they deserve answers...