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Auditors Fault Treasury Oversight of Bailout Funds
MICHAEL R. CRITTENDEN
Wall
St Journal
Wednesday, Dec 03, 2008
The Treasury Department has failed to address a
number of critical issues while implementing the $700 billion
financial rescue plan, including how to ensure its efforts are
successful, the Government Accountability Office said Tuesday.
The report, which was required by the legislation authorizing
the rescue plan, said Treasury has yet to figure out how to make
sure financial firms receiving billions of dollars of federal
funds comply with limits on executive compensation and dividend
payments. (Read
the full report.)
On a more basic level, the Treasury's efforts to establish "an
effective management structure and an essential system of internal
control" are incomplete, the report said.
(ARTICLE CONTINUES BELOW)
"Without a strong oversight and monitoring function, Treasury's
ability to help ensure an appropriate level of accountability
and transparency will be limited," the report said.
The report also noted that the Treasury has yet to fully staff
its Office of Financial Stability, which is implementing the Troubled
Asset Relief Program. The office will eventually need as many
as 200 full-time employees, the GAO said, but as of Nov. 21 only
48 employees were assigned to the TARP program. Increasing that
number in the near term could prove difficult, the report said,
because of the many permutations to the program since it was passed
by Congress and the transition to the next administration in the
White House.
These hiring issues, the report said, could limit the Treasury's
ability to keep key leadership positions filled, "potentially
creating uncertainty about the direction of the program and impeding
efforts to effectively implement TARP."
Full
article here
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