U.S. Senator Olympia J. Snowe (R-Maine) today hailed Senate passage of S. 386, the Fraud Enforcement and Recovery Act of 2009, bipartisan legislation to strengthen and expand the federal government’s ability to effectively crack down on mortgage and financial institution fraud in relation to federal assistance and relief programs.
"This legislation, which is long overdue, will take critical strides toward enabling the Justice Department and the Federal Bureau of Investigation to investigate and prosecute the mortgage and securities fraud that have played such a large role in bringing our economy to the brink of collapse," said Senator Snowe, a senior member of the Senate Finance Committee and a cosponsor of the bill.
According to the Congressional Oversight Panel that is charged with overseeing the Troubled Asset Relief Program (TARP), the total value of direct spending, loans, and guarantees provided to date in conjunction with the federal government’s financial stabilization efforts now exceeds $4 trillion. At the same time, not enough has been done to investigate and prosecute the mortgage and corporate fraud that contributed to the economic collapse. Senator Snowe has introduced legislation (S. 481) and advocated initiatives to hold those responsible for the economic meltdown accountable for their actions.
Specifically, the legislation the Senate passed today provides Federal agencies with $532 million in additional resources to bolster the number of field agents, prosecutors, and analysts to investigate and prosecute fraud. In addition, S. 386 expands current federal law to encompass fraudulent activities by mortgage lending businesses that are not directly regulated or insured by the Federal government.
"There is no question that additional manpower is an absolute necessity to combat fraud given rising caseloads and a wholly inadequate level of resources," Senator Snowe continued.
During Senate debate on the legislation, Senator Snowe cosponsored an amendment that would establish a Financial Markets Commission to investigate the cause of the financial crisis. "With the gravity of the current economic situation, it is critical to remove politics from the equation and independently investigate the reasons for the financial crisis," Senator Snowe said.
The amendment, offered by Senator Isakson of Georgia, would establish an independent commission to examine the causes behind the collapse of each major financial institution that failed and have the authority to refer wrongdoers to the Attorney General for prosecution. By December 2010, the 10-member Commission will report its recommendations for statutory and regulatory changes to prevent future financial collapses to the President and Congress. The amendment passed the Senate by unanimous consent.
"It is absolutely vital that every taxpayer dollar we have put at stake go toward economic stabilization and revitalization and not to line the pockets of those who seek to defraud the public," Senator Snowe concluded. "By sending a clear message that all perpetrators of fraud will be prosecuted and sent to prison, this legislation will, without question, help prevent these crimes in the future."