Thursday, October 14, 2010

Private Companies Do Most Of TARP Work For Treasury Raising Conflict And Transparency Issues

From Congressional Oversight Panel news release, "Congressional Oversight Panel Examines Use of Private Contractors in the TARP" on October 14, 2010:
Despite Treasury's Efforts, Significant Concerns Remain about Accountability and Potential Conflicts

WASHINGTON, D.C. - The Congressional Oversight Panel today released its October oversight report, "Examining Treasury's Use of Financial Crisis Contracting Authority." The Panel found that Treasury's extensive use of private contractors in Troubled Asset Relief Program (TARP) programs creates significant concerns about transparency and potential conflicts of interest. Although Treasury has taken considerable steps to ensure the appropriate use of private contractors, further improvements can and should be made.

Private businesses today perform many of the TARP's most critical functions, operating under 91 different contracts worth up to $434 million. In fact, the vast majority of people working on the TARP now receive their paychecks from private companies. Fannie Mae alone employs 600 workers on TARP's foreclosure programs, while Treasury has only 220 staffers working on all TARP programs combined.

Treasury has made notable efforts to ensure that it has used private contractors properly. For example, Treasury provided for competitive bidding for most of its contracts, and it has established several layers of controls to monitor contractor performance and to prevent conflicts of interest. This praise must be viewed in context, however. The government contracting process is notoriously non-transparent, and although Treasury appears to have performed well on a comparative basis, it remains capable of improvement.
Read the full news release here.

Read the full 159 page Congressional Oversight report, "Examining Treasury's Use of Financial Crisis Contracting Authority" here or embedded below.
TARP Oversight Report

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