Bank bailout and reporting, who is monitoring the money?
August 27th 2010 22:08
“The Federal Reserve Board sought to delay the court-ordered release of documents identifying banks that might have failed without the U.S. government bailout while it considers an appeal to the U.S. Supreme Court.
The Fed asked the U.S. Court of Appeals in New York yesterday to delay implementation of a ruling that compels the central bank to release the documents.
“The stay is necessary to permit the board to consult with the Department of Justice regarding an appeal to the Supreme Court,” Fed spokesman David Skidmore said.
The appeals court on Aug. 20 denied the Fed’s request to reconsider its decision requiring it to release records of the $2 trillion U.S. loan program (Ivy, & Glovin, 2010).”
Is anyone surprised by this news? HR1424 the Emergency Economic Stabilization Act of 2008 is the all of us remember by TARP. This and a couple of other bills were to help the financial sector banks, mortgage companies and credit unions not fail. Section 104 of the bill talked about a Financial Stability and Oversight Board, the language from the bill
SEC. 104. FINANCIAL STABILITY OVERSIGHT BOARD.
(a) Establishment- There is established the Financial Stability Oversight Board, which shall be responsible for--
(1) reviewing the exercise of authority under a program developed in accordance with this Act, including--
(A) policies implemented by the Secretary and the Office of Financial Stability created under sections 101 and 102, including the appointment of financial agents, the designation of asset classes to be purchased, and plans for the structure of vehicles used to purchase troubled assets; and
(B) the effect of such actions in assisting American families in preserving home ownership, stabilizing financial markets, and protecting taxpayers;
(2) making recommendations, as appropriate, to the Secretary regarding use of the authority under this Act; and
(3) reporting any suspected fraud, misrepresentation, or malfeasance to the Special Inspector General for the Troubled Assets Relief Program or the Attorney General of the United States, consistent with section 535(b) of title 28, United States Code.
(b) Membership- The Financial Stability Oversight Board shall be comprised of--
(1) the Chairman of the Board of Governors of the Federal Reserve System;
(2) the Secretary;
(3) the Director of the Federal Housing Finance Agency;
(4) the Chairman of the Securities Exchange Commission; and
(5) the Secretary of Housing and Urban Development.
(c) Chairperson- The chairperson of the Financial Stability Oversight Board shall be elected by the members of the Board from among the members other than the Secretary.
Section 105 is about the reporting and the reports that (b) Tranche Reports to Congress-
(1) REPORTS- The Secretary shall provide to the appropriate committees of Congress, at the times specified in paragraph (2), a written report, including--
(A) a description of all of the transactions made during the reporting period;
(B) a description of the pricing mechanism for the transactions;
(C) a justification of the price paid for and other financial terms associated with the transactions;
(D) a description of the impact of the exercise of such authority on the financial system, supported, to the extent possible, by specific data;
This is what the Senate and the House of Representatives agreed to when they approved the bill. Where are the reports that the banks were supposed to be sending to and the oversight committee was to be keeping tabs on? Wasn't congress monitoring this program? Isn't this extension unnecessary since the Chairman of the Board of Governors of the Federal Reserve is part of the oversight committee?
More transparency in the government. NOT!
References
By Bob Ivry and David Glovin Really Long Link
Really Long Link
The Fed asked the U.S. Court of Appeals in New York yesterday to delay implementation of a ruling that compels the central bank to release the documents.
“The stay is necessary to permit the board to consult with the Department of Justice regarding an appeal to the Supreme Court,” Fed spokesman David Skidmore said.
The appeals court on Aug. 20 denied the Fed’s request to reconsider its decision requiring it to release records of the $2 trillion U.S. loan program (Ivy, & Glovin, 2010).”
SEC. 104. FINANCIAL STABILITY OVERSIGHT BOARD.
(a) Establishment- There is established the Financial Stability Oversight Board, which shall be responsible for--
(1) reviewing the exercise of authority under a program developed in accordance with this Act, including--
(A) policies implemented by the Secretary and the Office of Financial Stability created under sections 101 and 102, including the appointment of financial agents, the designation of asset classes to be purchased, and plans for the structure of vehicles used to purchase troubled assets; and
(B) the effect of such actions in assisting American families in preserving home ownership, stabilizing financial markets, and protecting taxpayers;
(3) reporting any suspected fraud, misrepresentation, or malfeasance to the Special Inspector General for the Troubled Assets Relief Program or the Attorney General of the United States, consistent with section 535(b) of title 28, United States Code.
(b) Membership- The Financial Stability Oversight Board shall be comprised of--
(1) the Chairman of the Board of Governors of the Federal Reserve System;
(2) the Secretary;
(3) the Director of the Federal Housing Finance Agency;
(4) the Chairman of the Securities Exchange Commission; and
(5) the Secretary of Housing and Urban Development.
(c) Chairperson- The chairperson of the Financial Stability Oversight Board shall be elected by the members of the Board from among the members other than the Secretary.
Section 105 is about the reporting and the reports that (b) Tranche Reports to Congress-
(1) REPORTS- The Secretary shall provide to the appropriate committees of Congress, at the times specified in paragraph (2), a written report, including--
(A) a description of all of the transactions made during the reporting period;
(B) a description of the pricing mechanism for the transactions;
(C) a justification of the price paid for and other financial terms associated with the transactions;
(D) a description of the impact of the exercise of such authority on the financial system, supported, to the extent possible, by specific data;
This is what the Senate and the House of Representatives agreed to when they approved the bill. Where are the reports that the banks were supposed to be sending to and the oversight committee was to be keeping tabs on? Wasn't congress monitoring this program? Isn't this extension unnecessary since the Chairman of the Board of Governors of the Federal Reserve is part of the oversight committee?
More transparency in the government. NOT!
References
By Bob Ivry and David Glovin Really Long Link
Really Long Link
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