McConnell: TARP Report ‘a major wake-up call’

‘Firms that taxpayers helped out last fall want to pay back their loans. Unfortunately, Treasury doesn’t seem to want to take the money’

WASHINGTON, D.C. - U.S. Senate Republican Leader Mitch McConnell made the following remarks on the Senate floor Wednesday regarding TARP funds and protecting the taxpayer:

“Last fall, many of us in Congress weren’t all that excited about rescuing financial firms from problems that many of them brought about themselves. But we decided swift action was needed precisely to protect ordinary Americans from the mistakes these firms had made.

“At the time, Republicans insisted on strong taxpayer protections, and none of us had any doubt that once these banks were healthy again, they’d pay the money back to the taxpayers who gave it to them.

“Now we’re hearing a different story. A number of the firms that taxpayers helped out last fall are now on the road to recovery and want to pay back their loans. Unfortunately, Treasury doesn’t seem to want to take the money. This wasn’t the original plan, and it just doesn’t seem right to most people. If a bank wants to pay the taxpayers back, the government shouldn’t block the door.

“Just as troubling is a new report by the Special Inspector General who’s overseeing all the financial rescue programs. It alleges the same kind of fraud that we warned about back in October, including about 20 preliminary and full criminal investigations for everything ranging from securities fraud, to mortgage fraud, to insider trading, to public corruption related to the $700 billion in rescue funds.

“All of this is a major wake-up call. The Treasury needs to root out the fraud now, particularly at a time when the new Administration is vastly expanding the size and scope of these programs. As these programs expand, so will the potential for abuse. The Treasury Department also needs to let these banks extract themselves from government control as soon as they want to. That was the original plan the American people signed on to. And they have a right to expect that the original plan will be carried out — free from fraud and abuse.”