|Provision Requires Recipients of Government Assistance to Publicly Report Increased Lending|
Washington, DC –On January 21, 2009, the U.S. House of Representatives passed legislation reforming and strengthening accountability in the Troubled Assets Relief Program (TARP) included in the Emergency Economic Stabilization Act passed last October. H.R. 384, the TARP Reform and Accountability Act, incorporated the provisions of the TARP Accountability Act, introduced earlier this month by Congressmen Steve LaTourette and Al Green.
The LaTourette-Green bill requires that insured depository institutions that receive assistance through the TARP disclose in their quarterly financial reports the amount of increases in their new lending that are attributable to the assistance provided through these bills. If the depository institutions are unable to specifically document how much of the increases in lending are attributable to the emergency government assistance, they will instead be required to report their total increase in new loans.
The TARP Reform and Accountability Act, which included not only the LaTourette-Green legislation but also important provisions requiring that at least $40 billion of the TARP funds be used for foreclosure mitigation and ensuring that smaller community financial institutions are able to benefit from the TARP, passed the House by a 260-166 vote.
This legislation will play an important role in ensuring that, going forward, the TARP is used to mitigate foreclosure and to increase lending, as was intended.
“The American people have made clear that they want and need transparency,” said Congressman Green. “We in Congress must make sure that we do our part and follow through to ensure that the TARP is being used to invigorate our economy. It is time to get our economy moving again, and passage of this legislation will be a strong step forward in the effort to do so.”
“Our economy continues to suffer greatly, with over 1 million jobs lost over the last two months and over 2.2 million homes going into foreclosure in 2007,” said Congressman Green. “It is critical that we make sure that these programs are working as effectively and are benefiting the economy as much as possible. The TARP Accountability Act, along with the entirety of the TARP Reform and Accountability Act, will both encourage lenders to do their part and give the American people confidence that our lenders are doing their best to make sure that the TARP is working for us all.”