It's good to hear that the U.S. Justice Department is focusing on the Wall Street titans as it deepens its probe into acts of fraud connected to America's subprime-mortgage scandal. According to McClatchy News:

Turning its scrutiny to bigger fish in the subprime mortgage scandal, the Justice Department is investigating whether lenders or Wall Street firms defrauded investors in the sale of risky mortgage securities ...

According to (Assistant Attorney General Lanny) Breuer, the FBI received upwards of 70,000 "suspicious activity reports" relating to possible mortgage fraud in 2009 and has 2,800 investigations under way nationwide.

Click here to visit CREW's TARP Tales website, which monitors how the TARP bailout money is being spent and which banks have received these funds.

As 2009 draws to a close, CREW is looking back at what quickly became a busy year for ethical lapses in our federal government. Today, CREW released its list of the Top Ten Ethics Scandals of 2009 – a roundup of the year’s most outrageous government scandals.

The unranked list includes:

Believe us – we had a plethora of scandals to choose from.

Melanie Sloan, CREW’s executive director, explained CREW’s hopes for the new year:

It would be nice if 2010 proved to be the year politicians put Americans’ interests above their own, but I won’t hold my breath.

Click here (PDF) to read CREW’s Top Ten Ethics Scandals of 2009.

Treasury Secretary Tim Geithner is under such intense criticism these days that some observers are openly speculating who — if anyone — might be waiting in the wings if Geithner vacated this key cabinet post. One name that's being floated is Jamie Dimon, the CEO of JP Morgan Chase.

So what do we know about Dimon and how he views the way the government responded to last year’s financial crisis?

Even though JP Morgan Chase employs more than 220,000 employees, Dimon has written that he rejects the "too big to fail" mantra. According to Dimon:

... if some unforeseen circumstance should put this firm at risk of collapse, I believe we should be allowed to fail.

On the other hand, Dimon does not support legislation to cap the size of a financial institution:

Artificially limiting the size of an institution, regardless of the business implications, does not make sense. The goal should be a regulatory system that allows financial institutions to meet the needs of individual and institutional customers while ensuring that even the biggest bank can be allowed to fail in a way that does not put taxpayers or the broader economy at risk.

CREW has been pressing federal officials for greater transparency and oversight of TARP funds. We created the blog TARP Tales to post and monitor developments — the latest news stories and reports can be found there.

Earlier this month, CREW filed a lawsuit against the Board of Governors of the Federal Reserve System, challenging the Board’s failure to produce records that identify the recipients of the Board’s financial assistance over the last six months. Our lawsuit seeks to know the amount each institution received and the terms of the assistance.

CREW has been tracking all things TARP-related over at TarpTales.org. There's ample material and it's usually not good.   A report from the Congressional Oversight Committee found that credit markets are being helped as planned:

The panel set up by Congress to oversee the $700 billion financial bailout package said one of the government's main efforts to support credit markets is meeting a host of problems and slim demand.

"With these uncertainties, and the fact that so far there have been fewer issuances under the program than expected, it is not yet clear that the program has been well-designed to meet its purposes," the Congressional Oversight Panel said in a report released on Thursday.

The Treasury Department and Federal Reserve last year set up a program called the Term Asset-Backed Securities Loan Facility (TALF) to provide financing and support for the nation's markets in a variety of loans that are bundled into securities.

But the oversight panel said that the aid may be slow in reaching small business and family borrowers and that the underlying problems with demand may hamper the program's success.

 

One month ago, CREW launched TARPtales.org -– a comprehensive online resource for the latest news, reports and congressional hearings related to the government’s $700 billion Troubled Asset Relief Program, or TARP. The site is constantly updated with the never-ending stream of information about TARP and its troubles, including:

524 TARP news stories;

101 reports from governmental and nongovernmental groups; and

links to 61 congressional hearings.

All postings have been categorized and are searchable by corporation, oversight body, or congressional committee.

TARPtales.org also features descriptions of and links to the myriad TARP oversight bodies and independent watchdogs that are monitoring the government’s spending of bailout funds, as well as a detailed timeline of TARP-related events and developments.

News surrounding TARP, of which over $500 billion has already been spent, has remained controversial. This week, CREW posted the latest quarterly report from the Special Inspector General for TARP, or SIGTARP, as well as related analysis analyzing Inspector General Neil Barofsky’s findings. The report was notable in that it disclosed the inspector’s office had recently opened nearly 20 criminal investigations related to investments made with bailout funds.

Also this week, CREW posted the testimony of Treasury Secretary Timothy Geithner before the Congressional Oversight Panel, an independent group charged with reviewing the Treasury Department’s management of TARP. Panel head Elizabeth Warren raised significant transparency concerns with Secretary Geithner, and panel member and former Sen. John Sununu concluded, “You’ve left more questions unanswered than answered."

CREW launched TARPtales.org to be a central repository and crucial resource for any wanting to learn more about how American taxpayer dollars are being used to stabilize our failing institutions during this period of economic turmoil. By posting all the TARP-related information available, we hope to arm journalists, watchdogs, and the general public with the tools to keep track of the government's bailout activities.

A report will be issued today by the inspector general of TARP.   That office is already investigating 20 cases of "potential fraud" according to a report in The Hill:

Neil Barofsky, the top watchdog over the government’s financial bailout efforts, is pursuing 20 civil and criminal investigations into potential fraud in the programs.

In an interview with The Hill, Barofsky, the special inspector general for the Troubled Asset Relief Program (TARP), said he has urged his staff of 37 to zero in on fraud, push cases and deter crime.

“We really need to press forward on these things because, unlike the traditional prosecutorial law enforcement investigation, where the end is the indictment and bringing justice, which is important, here we have such an important role in deterrence that it’s very important for us to get these charges out quickly,” said Barofsky, who is set to release a quarterly report on the TARP on Tuesday, and will testify before Congress on Thursday.

“Obviously we have to be right and we have to investigate fully, but there is a time pressure … We’re going to try to push these investigations, be as aggressive as we can and move as quickly as we can.”

CREW just launched TARPtales.org, a new website that will serve as a central repository for the latest news, reports, and congressional hearings related to the Troubled Asset Relief Program (TARP). Armed with $700 billion in taxpayer money, TARP has been charged with keeping banks and other big businesses afloat during the economic downturn.

Since its inception, TARP has come under criticism for a lack of transparency, oversight, and effectiveness. Just last week, it was reported that AIG, an insurance and financial services company, used a portion of its bailout funds to pay $218 million in bonuses to executives. Melanie Sloan, CREW’s executive director, said:

The goal of TARPtales.org is to both educate the public and hold the government accountable for all-things TARP. Before now, there has been no one place the American taxpayer could go to keep tabs on the government bailout; TARPtales.org aims to change that.  With $700 billion at stake, diligent oversight is imperative. TARPtales.org should become a go-to source for anyone trying to monitor how the government is spending our money.

Checkout TARPtales.org regularly.  There's always something new.

As outrage continues to grow over AIG's bonuses, today, the Chief Executive Officer of the company, Edward Lilly, will appear before the Subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises of the House Financial Services Committee.  The hearing can be viewed live here.  CBS News had background:

Edward M. Liddy, chairman and CEO of American International Group Inc. since last fall, has become the reluctant defender of princely employee bonuses that members of Congress - and much of the American public - find indefensible.

AIG, the giant insurance company that has received $170 billion in government assistance, is paying more than $200 million in bonuses to keep employees from fleeing its troubled financial products division. On Wednesday, Liddy was to pull up a chair at a congressional witness table and take the heat.

The retention payments - ranging from $1,000 to nearly $6.5 million - were not his idea. Liddy himself is not getting a bonus. The deals were cut early last year, long before then-Treasury Secretary Henry Paulson asked Liddy to take over the company. 

Yesterday, CREW called on the Administration and Congress to demand AIG return $165 million in taxpayer funds to the government to help fix our broken economy.   Join us in that call.

Click here to sign CREW's petition

Take action today: Join us in calling on the Administration and Congress to demand AIG return $165 million in taxpayer funds to the government to help fix our broken economy.

Click here to sign CREW's petition

The U.S. government should demand AIG immediately return $165 million to the U.S. Treasury.  AIG executives who helped create the current financial crisis should be condemned, not rewarded for their shameful conduct.  AIG may be contractually bound to provide the bonuses but American taxpayers are not.  Each and every time a company receiving government bailout money hands out a bonus, that company should return an equal amount to the taxpayers to be spent rebuilding our economy. Given the responsibility these companies and those executives bear for the financial meltdown, it is the least they can do.

Today, we are calling on the Administration and Congress to demand AIG return $165 million in taxpayer funds to the government to help fix our broken economy.   Join us in that call.

Sign CREW's petition now.

Barney Frank wants the bad actors in the financial crisis to pay:

House Financial Services Chairman Barney Frank (D-Mass.) is pressing state and federal authorities to seek criminal and civil penalties on financial actors that helped cause the current crisis.

"Rules don't work if people have no fear of them," Frank said at a press conference Thursday.

He announced a hearing March 20 with Attorney General Eric Holder, bank regulators and the Securities and Exchange Commission as witnesses to discover what their plans are to prosecute irresponsible and in some cases criminal behaviors.

He isn't looking for names, Frank said, but "I do want all the people with enforcement power, state and federal, in that room."

Now, we think that Frank's quote,  "Rules don't work if people have no fear of them," could also apply to the House Ethics Committee.  If Congress can't police itself, people have no fear of the rules.