TARP Watchdog to Audit Overcharging in Bailout Contracts
Thursday, February 11, 2010
Doling out $700 billion to bail out banks required a lot of manpower, according to the Department of the Treasury, which turned to private accounting and legal firms to help run the Troubled Asset Relief Program (TARP). But there are concerns that some of these firms—which so far have been paid $159 million—may have charged excessively for their services, leading TARP’s special inspector general, Neil Barofsky, to begin investigating how Treasury officials chose the companies and whether the government is being gouged.
Senator Tom Coburn (R-Oklahoma) requested the audit after the Treasury Department blacked out the labor rates from the contracts it posted online. Some of the firms hired have been known to bill clients as much as $1,000 an hour.
ProPublica says nearly 60 companies were hired to help operate TARP, and the Government Accountability Office says the total payout for the outside help could reach $600 million.
-Noel Brinkerhoff
TARP Watchdog Launches Audit of Bailout Contracts (by Paul Kiel, ProPublica)
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