House Passes Key Legislation to Improve Bailout Transparency

An important bailout oversight bill sponsored by Representatives Carolyn Maloney (D-NY) and Peter King (R-NY) just passed the House with a vote of 421-0. The TARP Accountability and Disclosure Act of 2009 (H.R. 1242) would add a much-needed dose of transparency to the government’s bailout programs by creating a centralized electronic database with real-time updates on the expenditure of Troubled Asset Relief Program (TARP) funds. The database would integrate information from both public and private sources, including regulatory filings, internal models, financial models, and analytics associated with the financial assistance received under the TARP.

As Rep. Maloney explained, this information is already being collected, but it’s currently housed in incompatible formats at a host of different agencies, including the SEC, Federal Reserve, and FDIC. By standardizing the data and combining it in one centralized database, the legislation will allow regulators and members of the public to keep better track of how the bailout funds are actually being spent:

“When TARP began, the Treasury Department never required the financial institutions it funded to explain what they did with the money, and over a year later, we still do not know. It is past time for us to have a system so that the American people can tell in real time, enhancing its value as a regulatory tool and also as a preventive oversight tool.

...By using tools that currently exist, individual filings and transactions can be pulled together to create a single view of an institution and provide better management and regulatory oversight. The basic data elements would include, but not be limited to, the following: the capture and standardization of every transaction the institution is involved with, wherever possible; news releases, press releases and other sources of public data; counterparty filings; securities transactions; UCC filings in certain cases; and transaction data including mortgages, debt issuance, and fund participation. In the simplest terms, my bill allows the question to be answered: where has the money gone?

...The lack of transparency in terms of how TARP funds are being spent makes this bill necessary. The American people, Members of Congress, and regulators are demanding transparency. It is time that we gave it to them.”

Click below to watch the rest of Rep. Maloney’s statement:

Earlier this year, POGO joined a coalition of good government groups in support of the bill. At one point we had concerns that the public would not be able to access the database, but the bill was later amended to include a provision that requires public access to all non-proprietary information.

We applaud the House for taking action to make the government's bailout efforts more transparent and accountable. The legislation now moves to the Senate, where Sen. Mark Warner (D-VA) has introduced a companion bill.

-- Michael Smallberg

Comments

[Posted on: Dec 02, 2009 at 09:14 PM]

One last thing, the government accounting firms in conjunction with some traders were shorting energy stocks on insider information from FED, & FDIC. How will this effort correct that matter with this integration effort?

[Posted on: Dec 02, 2009 at 09:07 PM]

Bravo...Where is Congressman Ron Paul? Has he been training the Congress and Senate?...Regardless there is no excuse for not knowing in the information age. After this integration project FED-FDIC-SEC, the next step is to stop the bank robberies. Thus, FBI/CIA/Secret Service/IG links are needed for accountability and justice purposes. Remember the FED-FDIC-SEC are linked to the BANKS.