Barofsky Says TARP ‘Almost Certainly’ Will Bring Loss

[girl gone mad]

Barofsky Says TARP ‘Almost Certainly’ Will Bring Loss
http://www.bloomberg.com/apps/news?pid=20601103&sid=a44MGDYGcZHk">Bloomberg

Nov. 12 (Bloomberg) -- Neil Barofsky, the federal watchdog for the $700 billion financial industry bailout, said the program will “almost certainly” result in a loss to U.S. taxpayers.

“We need to temper or be realistic about our expectations, a dollar-for-dollar return is just highly unrealistic,” he said today at the Bloomberg Washington Summit. “It’s almost certainly going to be a loss.”

Barofsky, the special inspector general charged by Congress with policing the Troubled Asset Relief Program, also said he’s conducting 65 investigations of possible fraud. The former federal prosecutor has pressed the Treasury Department to be more open about the rescue of companies including insurer American International Group Inc. and automakers General Motors Co. and Chrysler LLC.

“Tens of billions of dollars are likely to be lost on the automotive bailout,” Barofsky said. In addition, some banks that received TARP money are failing, so the aid they received will be wiped out.

Barofsky also said he is working on a review of how the government exercises its rights as a shareholder in the auto companies, Citigroup Inc. and other firms in which it holds large stakes.

“We’re looking into this issue from the perspective of corporate governance,” Barofsky said. “What is the role the United States is playing in the management of these companies?”

Barofsky said his office is set to release an audit next week that looks at whether AIG paid more than necessary to banks including Goldman Sachs Group Inc. after the insurer’s bailout.

[virgogal]

1. Possible fraud in TARP? Gee,that's hard to believe.