Office of the Special Inspector General for the Troubled Asset Relief Program
The Homepage of this site (Click on the Link above to get to it) states the following:The Office of the Special Inspector General for the Troubled Asset Relief Program ("SIGTARP") was established by the Emergency Economic Stabilization Act of 2008 ("EESA").
The Special Inspector General, Neil M. Barofsky, was confirmed by the Senate on December 8, 2008, and was sworn into office on December 15, 2008.
What does their latest quarterly report say about pPIP?
PPIP Fraud Vulnerabilities: Aspects of PPIP make it inherently vulnerable to fraud, waste, and abuse, including significant issues relating to conflicts of interest facing fund managers, collusion between participants, and vulnerabilities to money laundering. SIGTARP has made a series of recommendations to address these concerns, including, among others, that Treasury should (i) impose strict conflict-of-interest rules upon Public-Private Investment Fund (“PPIF”) fund managers, (ii) mandate transparency with respect to the participation and management of PPIFs, including disclosure of the benefi cial owners of the private equity stakes in the PPIFs and of all transactions undertaken in them, and (iii) that all PPIF fund managers have stringent investor-screening procedures, including
comprehensive “Know Your Customer” requirements at least as rigorous as that of a commercial bank or retail brokerage operation.
What does the same report say about TALF?
Expansion of TALF: The announced expansion of TALF to permit the postingof MBS as collateral poses signifi cant fraud risks, particularly with respect to legacy residential MBS (“RMBS”). SIGTARP has made a series of recommendations to mitigate these risks, including, among others, that Treasury should require a security-by-security screening for legacy RMBS; that any RMBS should be rejected as collateral if the loans backing particular RMBS do not meet certain baseline underwriting criteria or are in categories that have been proven to be riddled with fraud, including certain undocumented subprime residential mortgages (i.e., “liar loans”); and that Treasury should require signifi cantly higher haircuts for all MBS, with particularly high haircuts for legacy RMBS.
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