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SIGTARP Barofsky Shows Why Watchdogs Are Important

By Robert Stacy McCain on 7.22.09 @ 7:48AM

Neil Barofsky -- SIGTARP, special inspector general for the Troubled Asset Relief Program bailout -- yesterday testified on Capitol Hill:

The Treasury Department took a bipartisan beating on Tuesday from lawmakers who claim the agency has failed to live up to its promises of transparency in handling the federal rescue of the financial system.
"The taxpayers now have a $700 billion spending program that's being run under the philosophy of 'don't ask, don't tell,' " Rep. Edolphus Towns, (D-N.Y.) said during a hearing on the Troubled Assets Relief Program, or TARP.
Rep. Darrell Issa (R-Calif.) went as far as to compare the Treasury's refusal to provide regular updates on how TARP money is being spent to the way convicted Ponzi scheme mastermind Bernard L. Madoff misled his clients. . . .
The antipathy during Tuesday's hearing of the House Committee on Oversight and Government Reform was provoked by a report issued earlier this week by Neil Barofsky, the special inspector general for TARP, in which he repeated calls for the Treasury to require regular, more detailed information from banks about their use of bailout funds. . . .
Barofsky also said Tuesday that his office was conducting 35 ongoing criminal and civil investigations as of June 30, covering topics from accounting and securities fraud to insider trading. "Really, almost any kind of white collar crime you can think of," he said.

Thirty-five separate investigations! No wonder the Treasury department is trying to prevent Barofsky from getting the documents he has subpoenaed. The independence of these watchdogs is what Gerald Walpin says this fight is all about:

"For a second I was thinking, 'Why do I need all of this?' I'll just resign and go back to my good legal practice in New York," Gerald Walpin told The Washington Times' "America's Morning News" radio show Tuesday.
"But I would then be part of the apparatus that is totally torpedoing the inspectors general," Mr. Walpin said. "The watchdog would not really be a watchdog. He'd just be afraid of his shadow." . . .

More at Memeorandum.