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Klobuchar: Hold Wall Street Accountable

Friday, January 9th, 2009 at 6:56 am

Washington, D.C. – Today U.S. Senator Amy Klobuchar sent a letter to Treasury Secretary Henry M. Paulson Jr. criticizing the Treasury Department’s handling of the Troubled Asset Relief Program (TARP) and calling for increased transparency in distributed funds. Noting reports of questionable uses of TARP funds, still-frozen credit markets and the continued slowing of the economy, Senator Klobuchar called into question whether the funds were being used appropriately.

“I strongly believe that those financial institutions receiving federal aid through the TARP must quickly provide a full accounting for their funds received, and I sincerely hope that the Department of the Treasury will move quickly to address this massive transparency gap,” said Klobuchar. “The Treasury Department’s failure to collect information on how companies are using TARP funds is, quite simply, unacceptable.”

In October, the Emergency Economic Stabilization Act authorized the Treasury Department to distribute TARP funds to financial institutions in order to protect Main Street from the economic instability of Wall Street firms.

The Treasury department has refused to require recipients of the funds to provide full accounting of what taxpayer funds were used for. Over $350 billion of the original $700 billion has already been appropriated.

The full text of Klobuchar’s letter is below:

January 8, 2008

The Honorable Henry M. Paulson, Jr.
U.S. Department of the Treasury
1500 Pennsylvania Avenue NW
Washington, DC 20220

Dear Secretary Paulson:

I am writing to you today regarding my concerns about the Troubled Asset Relief Program (TARP). I strongly believe that those financial institutions receiving federal aid through the TARP must quickly provide a full accounting for their funds received, and I sincerely hope that the Department of the Treasury will move quickly to address this massive transparency gap.

In the nearly three months since the Emergency Economic Stabilization Act was signed into law, American families have anxiously waited for its benefits to reach Main Street. But recent economic statistics show that these benefits are not helping those who are the most in need. Credit is not loosening up. Sales of existing homes dropped by 8.6 percent in November, and we have lost at least 1.9 million jobs this year. It is not surprising that the Conference Board’s consumer confidence index fell to an all-time low of 38 last week.

The Treasury Department’s failure to collect information on how companies are using TARP funds is, quite simply, unacceptable. Therefore, I hope that you will work with the Office of Financial Stability to determine a path forward that will enable us to once and for all answer the growing number of questions regarding appropriate expenditure of TARP funds.

Thank you for your consideration of my request. I look forward to your prompt reply.

Sincerely,
Amy Klobuchar

(From Office of Amy Klobuchar)

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