TARP Inspector General Neil Barofsky Resigns

That's too bad.

From CNN Money:

NEW YORK (CNNMoney) -- Neil Barofsky, the special inspector general of the Troubled Asset Relief Program, informed President Obama on Monday that he is resigning from his position, effective March 30.

"I believe that it is the right time for me to step down and pursue other opportunities," Barofsky wrote in his resignation letter.

Barofsky said he has fulfilled his goals related to TARP since his nomination by former President Bush on Dec. 8, 2008. These goals, he said, were "to build a robust law enforcement agency to bring to justice to those who sought to profit criminally from TARP" and "to ensure transparency in the operation of TARP."

He said he also achieved the goal of providing "effective oversight over the government's decision-making process to minimize instances of waste, fraud and abuse."

He said that he had only one co-worker when he started the "SIGTARP" job and was "working out of a small office in the basement of the Main Treasury building." Since then, he said the position has grown to 140 auditors, investigators and attorneys, with offices in Washington, New York, San Francisco, Los Angeles and Atlanta.

The team is now being led by Deputy Special Inspector General Christy Romero who will continue its mission.

Rep. Darrell Issa of California praised Barofsky for his "extraordinary commitment to public service" but he said the work that he begun is not finished.

Issa said the next Inspector General needs to demonstrate Barofsky-style "vigilance, courage and commitment" in dealing with the 150-plus TARP recipient banks that have missed their regulator dividend payments.

Issa also said the next Inspector General needs to deal with the Home Affordable Modification Program, which "has fallen short of its goal to preserve home ownership."

Barofsky did not say what he plans to do next.

Just don't go work for Goldman Sachs or PIMCO.

I don't know whether Ms. Christy Romero will become the next Inspector General or not, but we shouldn't be expecting much from her. Her resume shows she worked for Mary Shapiro and Christopher Cox at the SEC before she came to SIGTARP.

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Fed Rejects Geithner Request for Study of Governance, Structure

and Ben Bernanke (after successfully campaigning for the second term) has been pushing his organization (Federal Reserve) hard as ready and fit to be THE regulator of the financial life of the entire nation (if not the world) and himself at its head to preside over commercial banks, investment banks, hedge funds, community banks and credit unions, insurance firms, credit card issuers, mortgage companies, and oh by the way consumers? Does that make sense to you?

Fed Rejects Geithner Request for Study of Governance, Structure
(9/21/09 Bloomberg)

"Sept. 21 (Bloomberg) -- The Federal Reserve Board has rejected a request by U.S. Treasury Secretary Timothy Geithner for a public review of the central bank’s structure and governance, three people familiar with the matter said.

"The Obama administration proposed on June 17 a financial- regulatory overhaul including a “comprehensive review” of the Fed’s “ability to accomplish its existing and proposed functions” and the role of its regional banks. The Fed was to lead the study and enlist the Treasury and “a wide range of external experts.”

"Some top central bank officials, after agreeing to the review, saw a potential threat to Fed independence after the Treasury released the proposal, two of the people said. The Obama plan said the Treasury would consider recommendations from the review and “propose any changes to the Fed’s governance and structure.”

"“It is not obvious at all why that is a Treasury responsibility or even appropriate why the Treasury would undertake that kind of study,” said Robert Eisenbeis, chief monetary economist at Cumberland Advisors Inc. in Vineland, New Jersey, and a former Atlanta Fed research director. “The Fed was created by Congress and it is not part of the executive branch.”" [emphasis is mine]

Aha.

The Federal Reserve Act was indeed passed by Congress two days before the Christmas Eve in 1913 and signed into law by President Woodrow Wilson the next day. Needless to say, not all Congressmen and Senators were in town. It is indeed NOT part of the executive branch, it is not part of any branch of the government. It is a PRIVATE banking cartel owned by the member banks.

Particularly since September 2008 the Federal Reserve has been inseparable from the Treasury Department in executing the financial rescue plans, almost without any oversight. It has been acting as if they were part of the government. Now they want to hide behind Congress?


Not so fast. Here comes H.R. 1207, the bill by Congressman Ron Paul to audit the Fed. The bill has 290 co-sponsors as of today and Barney Frank, chairman of the House Banking Committee has said there will be a committee hearing on September 25, according to the Bloomberg article.

A very good summary of the structure of the current Federal Reserve System and how it is governed has recently been presented by person from an unexpected quarter, by the way: Neil Barofsky, special inspector general of Treasury Department to oversee the TARP program. The July 21, 2009 quarterly report to Congress from his office has a concise summary of the Federal Reserve System, from page 130 to page 136, including the table summarizing various loan schemes created by the Fed.

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