Treasury Secretary Timothy Geithner unveiled a retooled TARP and Web site that will track funds and the effect of the financial stability plan on credit markets.
The Obama administration’s financial recovery package would require more accountability from financial institutions and the Treasury Department on how Troubled Asset Relief Program (TARP) funds are spent, according to a new plan released by Treasury Secretary Timothy Geithner.
All information disclosed or reported to Treasury by institutions receiving funds would be posted to a new Web site at www.FinancialStability.gov, Geithner said. The department will also regularly update metrics that demonstrate the effect of the financial stability plan on credit markets, he added. Geithner unveiled the retooled program Feb. 10.
The new plan aims to “restart the flow of credit, clean up and strengthen our banks, and provide critical aid for homeowners and for small businesses,” Geithner said. The Bush administration had used half — $350 billion — of the money available under TARP. Geithner’s plan seeks to account for the other $350 billion. However, he did not provide any cost details.
“As we do each of these things, we will impose new, higher standards for transparency and accountability,” he said.
Under the plan, Treasury would post all financial contracts on the Web site within five to 10 business days of their completion, Geithner said. Whenever Treasury makes a capital investment under the new initiatives, officials will make public the value of the investment, the quantity and price of warrants received, and the schedule of required repayments to the government, according to the plan. The terms and pricing of those investments would be compared to terms and pricing of recent market transactions during the period the investment was made, if available.
Gene Dodaro, acting comptroller general at the Government Accountability Office, told the Senate Banking, Housing and Urban Affairs Committee Feb. 5 that Treasury needed to further improve the transparency and accountability of TARP. Dodaro said Treasury had taken steps to begin implementing previous GAO recommendations.
GAO is required to provide oversight of TARP by reporting to Congress every 60 days on the program’s progress and other issues. As of Jan. 23, Treasury had disbursed $294 billion in TARP money.
GAO also recommended that Treasury:
- Expedite efforts to make sure that sufficient employees are assigned and trained to oversee the performance of contractors.
- Develop a comprehensive system of internal controls over TARP, including policies, procedures and guidance, to ensure that requirements are met.
- Implement a well-defined, disciplined and monitored risk-assessment process.
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