Washington, DC – U.S. Senators Dianne Feinstein (D-Calif.) and Olympia Snowe (R-Maine) today issued the following statement in response to media reports that firms receiving federal assistance as part of the Troubled Asset Relief Program (TARP) have continued to spend heavily on lobbying activities.
Senators Feinstein and Snowe are the authors of bipartisan legislation, called the Troubled Asset Relief Program Transparency Reporting Act, which would promote transparency and establish strict accountability standards for firms receiving TARP funds. The bill was originally introduced during the 110th Congress on November 20, 2008, and was reintroduced with a new bill title for the 111th Congress on January 6, 2009.
“American taxpayers put hundreds of billions of dollars on the line to rescue financial institutions, but we still don’t know how this money is being spent,” said Senator Feinstein. “This lack of transparency is simply unacceptable. Taxpayers deserve better, and the time has come to restore confidence in this unprecedented effort. Clear restrictions must be imposed on firms receiving assistance. These include tougher reporting requirements, lobbying prohibitions, and a ban on lavish and unnecessary expenditures.”
“I was deeply disappointed with the lack of transparency in the distribution of the first half of the TARP, which forced taxpayers to foot the bill for acquisitions by firms that received financial assistance from the federal government,” said Senator Snowe. “Mindful of recent lessons, this legislation includes the right safeguards to ensure taxpayer dollars will not used to subsidize K Street in Washington.”
The Feinstein-Snowe legislation would:
- Prohibit firms receiving economic assistance from Treasury or emergency loans from the Federal Reserve from using such funds for lobbying expenditures or political contributions;
- Require that firms receiving assistance provide detailed, publically available quarterly reports to Treasury outlining how federal funds have been used;
- Establish corporate governance standards to ensure that firms receiving federal assistance do not waste money on unnecessary expenditures; and,
- Create penalties of at least $100,000 per violation for firms that fail to meet the corporate governance standards established in the bill.
The bill, S.133, is also cosponsored by Senator Barbara Boxer (D-Calif.), Senator Benjamin Cardin (D-Md.), Senator Russ Feingold (D-Wisc.), Senator John Kerry (D-Mass.), Senator Joseph Lieberman (I-Ct.), Senator Patty Murray (D-Wash.), Senator Bill Nelson (D-Fla.), and Senator Arlen Specter (R-Pa.).