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Swept Under the TARP, Grabs by GMAC, PHH and CIT, Wachovia's
Sewers
Byline: Matthew R. Lee of Inner
City Press on Wall Street: News Analysis
NEW YORK, December
8 -- After most big banks and
even many non-banks have already drawn down their bailout funds from
the government's
Troubled Assets Relief Program, there's belated interest in Congress in
what banks
have been doing. Monday afternoon on the Senate floor, Byron Dorgon of
North
Dakota expressed shock at Wachovia's
purchase and lease-back of German sewer
system, just so it could use the depreciation of the German pipes to
avoid its
U.S. taxes.
Now that
Wachovia is being bought -- by Wells Fargo and not as Washington wanted
Citigroup
-- is it easy to finally criticize it and its outgoing
management. But
how about Citigroup and its entrenched officials Robert Rubin andVikram
Pandit, who right after its second
bailout serving spent eight billion Euros buying the highway
business of
Spanish construction firm Sacyr Vallehermoso?
The
TARP program is
full of abuses. Focus only on some pending ones, the conglomerate PHH
says it
is applying for TARP funds, without owning any bank or thrift. Its
application
is not even on the Office of Thrift Supervision's website. Nor, on the Federal
Reserve's website, can any notice be found for the applications of
GMAC and
CIT.
The doling out of TARP funds has become a blur
Inner City Press and Fair Finance Watch have written to both
agencies
about these disappearances, and for the TARP-related applications of
Lincoln
and The Hartford, among others. Both are trying, like the subprime
servicer
Ocwen, to buy small banks in order to get TARP funds. If a having Utah
industrial loan company charter triggers eligibility, watch out.
The
bailouts and
favors are being doled without without any public comment, or even
public
notice. And on Capitol Hill they belatedly speak about two year old
abuses,
rather than the fresh ones of today, which could still be stopped. And
so it
goes in DC.
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