US Treasury slammed over handling of financial bailout (Still no investigation of the perp)

WASHINGTON (AFP) - A US congressional panel sharply criticized the Treasury for its handling of a 700 billion financial bailout fund, as lawmakers moved to demand more transparency and accountability.

The panel tasked with scrutinizing the operations of the Troubled Asset Relief Program (TARP) said it was in the dark about how some ailing banks that received swift cash infusions were using the aid money.

It also questioned the Treasury's basic strategy of using the public funds and apparent failure to ease the home mortgage crisis at the epicenter of the global financial meltdown that president-elect Barack Obama has made a top priority for his incoming administration.

But the White House fought back against criticism of the Treasury, whose chief Henry Paulson, a former top Wall Street banker, has been spearheading the Bush administration's efforts to contain the financial turmoil.

"The Treasury Department has been balancing the urgent need to act quickly while also adhering to the most rigorous oversight ever imposed," said White House deputy press secretary Scott Stanzel.

He noted that Congress had given broad authority to the Treasury Department to deal with "a challenge the likes of which we have never seen."

"I think that the Treasury Department has acted swiftly to try to get this money out the door to try to stabilize the financial system, and at the same time deal with the reporting requirements and the oversight requirements."

The congressional panel slammed the Treasury for failing to complete answers or address numerous questions over the bailout operations, saying there appeared to be "significant gaps" in monitoring use of taxpayer money.

"The panel's initial concerns about the TARP have only grown, exacerbated by the shifting explanations of its purposes and the tools used by Treasury," said the 65-page report by the panel led by Harvard Law professor Elizabeth Warren.

About 350 billion dollars from the mammoth fund has been allocated so far, mostly to ailing banks, as well as automakers, and insurance and credit card companies.

White House spokeswoman Dana Perino denied a decision had been reached on whether to request congressional approval to allocate the other half of the TARP funds.

"There have been discussions between the administration and the (Obama) transition team on how to proceed, should the president-elect determine that he would like president Bush to notify Congress on his behalf of the intent to use the remaining 350 billion dollars so that it will be available early in the new administration."

The oversight panel, which includes lawmakers from both sides of the political divide, "still does not know what the banks are doing with taxpayer money," the report said.

"So long as investors and customers are uncertain about how taxpayer funds are being used, they question both the health and the sound management of all financial institutions."

Certain private financial institutions have refused to provide any accounting of how they were using taxpayer money, a move the panel said "undermines public confidence."

"For Treasury to advance funds to these institutions without requiring more transparency further erodes the very confidence Treasury seeks to restore," the report said.

Lawmakers meanwhile are preparing legislation to make the Treasury more accountable for its handling of the remaining portion of the bailout funds.

The plan will "strengthen accountability, close loopholes, increase transparency, and require Treasury to take significant steps on foreclosure mitigation," said Barney Frank, a Democratic lawmaker heading the House Financial Services Committee.

The planned legislation further required the Treasury to also consider giving smaller financial institutions similar aid on the same terms as large institutions that received funding.

THE TARP SWINDLE COULD BE HUGE

Keep in mind---Treasury Secretary Paulson Threatened Senators with Martial Law if they did not vote him the bailout billions. Depraved Paulson also wanted to exempt the bailout from any judicial, legislative, and regulatory review. As for this Wall Street Pig.....any other country, Paulson would be in front of a firing squad about now.

All of it pinpoints Paulson's overwhelming greed to get his hands on the bailout billions. First thing he did was station his own man---Neel Kashkari---to (ahem) "oversee" the $700B bailout. Kashkari was Paulson's henchman at Goldman, and at Treasury.

Investigators may be looking at the legal parameters of prosecutable crimes including making false statements to federal officials, filing falsified documents, obstruction of proceedings before federal agencies, fiduciary negligence, and obstruction of US justice.

Authorities should investigate TARP's US Postal Service mailings, wire transfers, computer transfers, electronic submissions, and unregulated money transfers, and all bank transfers connected to TARP disbursements and bank accounts

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US Sen. Jim Inhofe (R-Oklahoma) said that Congress was not told the truth about the $700 billion blank bailout. "The American people don't know how much money Treasury Secretary Henry Paulson has given away to anyone. IT COULD BE TO HIS FRIENDS. We don't know. There is no way of knowing.''

TARP MODUS OPRANDI Taxpayers could have been swindled via an international Wall Street scheme with offshore ties. Taxpayers demand L/E tear apart TARP's books to determine the scope and dimension of falsified documents, wire transfers, bank documents, and Wall Street connecitons.

In classic Wall Street frauds (which former Goldman/Sachs poobahs Paulson and Kashkari are familiar with), Wall Street fraudsters keep two (or more) sets of books. One set keeps track of losses while the other set is what investors are shown.

Paulson and Kashkari may have facilitated theft of TARP funds by the Wall Street crowd by routing various theft schemes through telephone lines with a maze of complex telecommunications' systems equipped with call-forwarding and voice mail systems, and numerous postal and commercial mail boxes..........and perhaps sub rosa money-transfer systems that operate in ethnic enclaves and places like NYC's Diamond District.

The TARP monies could have been disguised by routing through a network of domestic and international bank accounts using counterfeit checks.....opening commercial bank accounts in the name of bogus businesses and wire-transferring............and/or depositing TARP checks into those accounts.

The TARP checks could have had invalid bank routing numbers, forged endorsements, or been drawn on the proceeds of other counterfeit checks deposited in other bank accounts. Friendly banks might then transfer monies out of the accounts……to secret numbered accounts offshore---after taking a cut for themselves.

Paulson and Kaskari's co-conspirators or subsets of them might have obtained hundreds of taxpayer identification numbers for phantom citizens with worldwide addresses, and used the information, along with phony passports, to open up numerous offshore bank accounts.

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TARP might have facilitated fraud by integrating:

1. Secret control over TARP allocations.

2. Requiring only one signature on TARP bank checks.

3. Utilizing pre-signed TARP bank checks.

4. Using secret bank accounts to keep hidden the actual financial position of TARP disbursements.

5. Assigning bank deposit and account reconciliation functions assigned to 1-2 Treasury officials.

6. Conspiring to hide oversight of TARP disbursements, expenses and supporting vouchers from public view.

7. Having no outside auditor to review TARP statements.

8. Cashing unusually large amounts of TARP checks.

9. Having no official TARP deposit and withdrawal control system.

Salivating to divvy up the taxpayers' billions.

Bernanke and Paulson, handover $6B tax dollars to their pal, J. Ezra Merkin.

Ezra Merkin is a hedge-fund billionaire who lost as much as $3 billion in investor funds with Bernie Madoff. Merkin was feeding hedge funds into Madoff's operation while serving as GMAC Chair (an auto-and home-financing company).

Many felt Merkin should not be trusted with $6B federal rescue money GMAC received. Merkin resigned as GMAC chair Friday. He pocketed hundreds of millions of dollars in investment fees over the years.

Merkin lives in a posh duplex at 740 Park Ave, Manhattan, known as the richest address in NYC. Merkin is the son of the late Hermann Merkin, a lion of Jewish philanthropy who gave millions to help build Yeshiva University, the Fifth Avenue Synagogue and NYC's Merkin Concert Hall.

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