The inspector general who oversees the government’s bailout of the banking system is criticizing the Treasury Department for misleading the public with statements it made last fall in order to raise money to the nation’s largest banks, reports the New York Times. The Treasury official made incorrect statements about the health of the nation’s largest banks, even as the government was funding them with billions of dollars in aid, according to a report on the Troubled Asset Relief Program to be released by the special inspector general, Neil M. Barofsky. Former Treasury Secretary Henry Paulson Jr. is believed to have said the banks were “healthy” on October 14, 2008, when in fact regulators were concerned about the health of several banks that received that first bailout. The Treasury Department said that any review of announcements last year “must be considered in light of the unprecedented circumstances in which they were made.”
Inspector General Suspects Treasury Misled Public
The inspector general believes the Treasury made misleading statements to the public during the financial crisis.
October 5, 2009