Former TARP IG met 'huge, huge resistance' from Treasury, DOJ

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Photo - Former Special Inspector-General for the Troubled Asset Recovery Program (SIGTARP) Neil Barofsky.
Former Special Inspector-General for the Troubled Asset Recovery Program (SIGTARP) Neil Barofsky.

Neil Barofsky, the first and now-former Special Inspector-General for the Troubled Asset Recovery Program (SIGTARP), says he met "huge, huge resistance from day one" within and without the federal government and on Wall Street in his effort to investigate how the $700 billion expenditure was administered, what was done with the tax dollars by the banks and other financial institutions that received loans through it in the great bailout of 2008, and whether the effort accomplished what Congress intended.

"They threw up roadblocks everywhere we -- every time we turned around. It took us three days just to get garbage cans in our offices. They did not exactly roll out the red carpet," Barofsky told Greta Van Susteren in an interview (see below) on Fox News. She was interviewing him on the occasion of publication of his book, "Bailout: An inside account of how Washington abandoned Main Street while rescuing Wall Street."

They were gun-shy and they were afraid to bring some of the tough cases. And it was remarkably frustrating. - Neil Barofsky

"And a lot of that was because of what our job was, which was to shine a light and bring transparency in a lot of areas that, frankly, the government and Wall Street wanted to keep dark, you know, basic concepts like what happened to the TARP money? You know, we just hit huge, huge resistance from day one," he said.

Barofsky was responsible for initiating prosecutions that have since led to nearly 100 convictions for a variety of financial crimes in connection with the TARP program, but he seemed to suggest to Van Susteren that there could have been many more.

Asked if he was surprised when it was announced this week that the government would bring no charges against Goldman Sachs for its role in bringing about the economic meltdown that led to the TARP program's creation, Barofsky said he wasn't:

"Yes, I wish I could say I was shocked by this, but I have to tell you I'm not. You know, part of my job at SIGTARP was we built a law enforcement agency that investigated and prosecuted those who tried to steal from the TARP program. You know, almost 100 people have so far been criminally charged. We had some great success," he said.

"But part of it is I had to deal with Department of Justice to get my cases charged, and I consistently saw a timidity and a lack of sophistication that was really -- they were gun-shy and they were afraid to bring some of the tough cases. And it was remarkably frustrating."

Also earlier this week, the Examiner Watchdog reported on a Government Accountability Institute study that concluded conflicts of interest created by the revolving door between big Wall Street firms like Goldman Sachs and powerful positions in the federal financial regulatory apparatus could explain the reluctance of Justice Department officials to bring high-visibility cases.

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