GM properly used escrow to repay U.S. loans, Treasury says

[DainBramaged]

General Motors Co., which repaid $4.7 billion in U.S. loans last week, properly used escrowed cash for the payment, a Treasury Department official said in responding to complaints from a Republican senator.

GM used the escrowed funds created with government loans and overseen by the Treasury after determining the cash wasn't needed for “extraordinary” expenses, Herbert Allison, Treasury's assistant secretary for financial stability, said in a letter to Sen. Charles Grassley of Iowa.

Grassley, the top Republican on the Senate Finance Committee, on April 22 wrote to Treasury Secretary Timothy Geithner that GM's repayment “appears to be nothing more than an elaborate TARP money shuffle” because the money came from the U.S. Troubled Asset Relief Program.

Allison said Grassley was incorrect in saying the escrow account was held at the Treasury, when the funds were held by the automaker.

Allison's written response echoed the points made by a treasury spokeswoman last week.

“The bottom line is that the repayment was made on the dime of taxpayers across America, and it's misleading to say that GM repaid its TARP loans ‘in full, with interest, ahead of schedule, because more customers are buying' GM cars,” Grassley said in a statement on his Web site following Treasury's determination.


Read more: http://www.autonews.com/apps/pbcs.dll/article?AID=/20100429/OEM/100429820/1424#ixzz0mWaYnZLd



Treasury says it's OK, Grassley can kiss my GM loving ass.

[ixion]

1. Then that little scam should be open to ALL businesses

that is:

1) Government hands you a large sum of cash in the form of a low-interest loan.
2) You invest that loan via an escrow account.
3) Profit!

Fair's fair. If it's good enough for GM, it's good enough for EVERY CORPORATION in the US.

[DainBramaged]

2. Sorry, you can't overrule Treasury, our conversation about this is done.

be well.

:hi:

[ixion]

4. Yeah, the auto-industry got theirs, and the banks got theirs

and the rest of us paid for it. Gotcha. Point made. Congrats. Best to you. :hi:

[NoNothing]

3. *Something* doesn't add up

If it's true that the escrowed funds were "created with government loans," then how is it possible to use those funds to pay off a government loan and end up having paid back all government loans in full?

[newblewtoo]

5. Ever see SNL's First City Change Bank?

The answer: Volume

http://www.nbc.com/saturday-night-live/video/first-citywide-change-bank/229045/

:shrug: