Bailouts And The Foreclosure Crisis: Report Of The Special Inspector General For The Troubled Asset

Good early morning and also welcome to
our very first hearing of the full Board on the 112th Congress. Today’s hearing is on
the bailout and also the repossession crisis, as well as specifically the record of the Unique Assessor
General for the Troubled Possession Alleviation Program, SIGTARP. This is the very first hearing for both Chairman Issa as well as Position Member Cummings, so I ask
every one of your indulgence as we undergo a variety of newbie blunders that certainly
I will make. The Chair keeps in mind that according to the guidelines,
there will not be opening statements. Nevertheless, members might have seven days to send opening
Mr. Chairman?
Legislative query, Mr. Chairman. I understand this is our first conference, and also I just want to make certain we are clear. We had a prolonged conversation on opening up statements–
[Chairman Issa] Would the gentleman state his function?
[Mr. Cummings] I am attempting to do that. We had a prolonged conversation yesterday with respect
to opening statements and I believed we had reached a remarkable contract where the Chairman
had claimed that he would give us observe when it come to opening statements, whether we were
providing or otherwise. And also this is our very first hearing and some of the members and also, of program,
I am simply questioning precisely why we are not having opening up statements and, two, we were
notified practically half a hr ago or two that there would certainly not be opening up declarations. I am just asking yourself. [Chairman Issa] I give thanks to the gentleman. The
Chair is forgoing opening up declarations, including my own, as well as, as I said, all participants will certainly have
7 days in order to put their opening declarations into the record. On a really individual note, I felt that it was crucial on this very first hearing to begin
off by paying attention to the witnesses as though this– and also I recognize that the Special IG, this
Mr. Chairman, additional parliamentary. Pursuant to what you stated yesterday– and also
I have the transcriptRecords will you be. I mean, I assumed we were very– we had actually a. gent’s wonderful discussion the other day where you stated you would provide us proper notice,.
As I stated, we will certainly mean to offer notice to all things.In this instance,.
Would certainly the Chairman yield for a concern? Mr. Chairman? Mr. Kucinich]
I have been in the Congress for 14 years and also I have never, it is just.
Does the gent have a. parliamentary questions? We will certainly now present
–. Mr. Chairman?
Chairman Issa] We will certainly currently present–. On a factor of order.
I certainly recognize if
the Chairman has has actually chosen he has nothing absolutely nothing. The Chair will respond for the document with an ideal list of the. You can’t think of one.
now. [Chairman Issa] The gentleman is no much longer. recognized.We now rely on our witnesses. Mr. Timothy.
Massad is the

Performing Assistant Assistant of the Treasury Department’s Office of Financial. Mr. Massad presumed the
title of Assistant.
Prior to. that, Mr. Massad served as the Principal Guidance and also Chief Coverage Officer for the Workplace.
of Financial Security. Prior to beginning his government job, he worked at. the beginning of the 2008 economic crisis. Mr. Massad was a partner at Cravath, Swaine & Moore,
. where he had a varied international corporate practice with an emphasis on security offerings
. and bank funding, counseling underwritings and security issues. Mr.Massad obtained an. B.A. level magna cum laude from Harvard College in 1978 and his J.D. magna cum laude

from.
Harvard Regulation Institution in 1984. Mr. Neil Barofsky, no stranger to this Committee,. was vouched right into the office on December 2008 as the Special Treasury Department Inspector. General to look after the Troubled Asset Relief Program. Prior to that, Mr. Barofsky was a. Federal prosecutor in the USA Attorney’s Office for the Southern District of New York. for greater than 8 years.In that office, Mr. Barofsky was the senior test counsel. that headed the mortgage scams group.
Mr. Barofsky additionally has substantial experience as a line district attorney. leading clerical prosecutions during his tenure as a member of the Securities and Products. Scams Device.
Mr. Barofsky also led the examination that. Mr. Barofsky got. York University of Legislation.
According to the Board guidelines, all witnesses. will be sworn in before testifying.
Please climb, increase your appropriate hand. Do you solemnly vow that the statement you are regarding to offer this Board will certainly be the. Witnesses react in the affirmative.
Environment-friendly suggests continue to go, yellow is the warning that you should. Thank you, Mr. Chairman. The typical regulation of Board is that we go.
in order of ranking. Mr. Massad, I believe you would certainly, by protocol, be initially. [Mr. Massad] Thanks, Mr. Chairman
. Chairman. Issa, Position Member Cummings, members of the Committee, thank you for the possibility. to testify today regarding the Distressed Property Relief Program, or tarpaulin, as it is generally. known.I am the Performing Aide Secretary for Financial Security at the Treasury, which. means I are in charge of managing the program on an everyday basis. I recognize that tarpaulin has not been prominent.
There is good factor for that: no person suches as. making use of taxpayer bucks to rescue financial institutions. Nonetheless, resting here today,. more than 2 years after a bipartisan Congress passed the regulations that developed tarpaulin,. it is clear that the program has actually been extremely effective by any type of objective action. TARP helped stop a tragic collapse of our economic system. and our economic situation. In the autumn of 2008 we were looking right into the void. Borrowing by financial institutions had. almost quit, our credit rating markets had shut down, and also countless banks. were under severe stress.This was a dilemma not only for Wall Street
, however additionally for Key. Road. Merely placed, we were at the risk of entering into a second Great Anxiety. Today people no more are afraid

that our major financial establishments or our monetary system.
is going to fall short. Banks are better capitalized and also the weakest components of our monetary system. no more exist. The credit scores markets on which local business as well as customers depend,
for. auto fundings, charge card, pupil loans and also other funding, have resumed.
Organizations. have the ability to raise resources as well as mortgage prices are at historic lows.
Naturally, the economy has not yet totally recouped and also there is still much work to be done.
Unemployment. is unacceptably high and also the housing market remains weak. The worst of the tornado has. passed. Second, we will certainly not utilize all the cash Congress. offered
for tarpaulin, and we are existing our investments as well as the economic sector much.

faster than anyone thought possible.Let me quickly sum up a couple of vital facts. Congress originally licensed$ 700 billion for this program. We will invest no more
than.$ 475 billion.

As well as of the cash spent to date, much of it has been paid back, around. $270 billion. We still have regarding $166 billion bought various establishments as well as I am. hopeful that we will certainly recover much of that over the next 2 years, depending on market. conditions. Lastly, the best cost of tarpaulin will certainly be. much much less than anyone expected.The complete price was initially predicted to be around.$ 350 billion. That number, however, has progressively declined over the previous 2 years. According.
to the most recent estimates from both Treasury and the nonpartisan Congressional Budget plan Office,.
In addition, the TARP price will certainly be largely attributable to what we invest on our housing. In all of these initiatives, Tarpaulin has been subjected to unmatched oversight.When Congress. General for TARP, Mr. Barofsky, who is sitting with me today, to very carefully assess all of.
it has assisted us to establish, apply, and also frequently enhance our tarpaulin programs.And. we have strived to be clear by giving a wealth of info regarding the program. to the public.
Mr. Barofsky’s most recent quarterly record. TARP helped, as he placed it, head off a devastating financial collapse and also that the program’s. The record likewise raises a number of worries about the HAMP program.
Mr. Chairman, TARP was successful in what it was designed to do: it helped stabilize the financial.
system as well as lay the structure for financial recovery.It was not developed to resolve all.
our problems, and also we recognize that many Americans are still suffering. Nonetheless, thanks to.
Both political parties are entitled to credit rating for these accomplishments. Congress.
passed the program at a time when the economic system

was falling apart.
In that minute,. leaders from both celebrations stood, stood together and did what was finest for this Country.
Thanks once more for giving me the chance to indicate here, as well as I welcome your inquiries.
[Chairman Issa] Thanks. Mr. Barofsky. [Mr. Barofsky] Chairman Issa, Ranking Member. Cummings, participants of the Board, it is an honor and also a privilege to show up prior to. you once more as well as to when again existing to you our latest quarterly record to Congress. This previous quarter has actually noted the two-year wedding anniversary of both tarpaulin and also SIGTARP. For. SIGTARP, we have actually made fantastic progression in making every effort to satisfy our goals of openness, oversight,.
and also enforcement.With this, our nine quarterly report, in addition to 13 separate audits, they. have actually assisted to shine a light on several of the darkest areas of the financial situation and. the Federal government’s reaction. They have also included essential referrals which,. when executed as well as taken on, have led to terrific savings for the taxpayer and avoiding.
fraudulence, waste, and abuse

. Our Examinations Division has actually been likewise. active. We have had the ability to secure criminal or civil fraud costs against 45 different. individuals, 12 various business and,
to date, 13 criminal convictions. We have likewise. had the ability to either protect against or recover from loss of scams a lot more than$ 700 million, consequently. guaranteeing that SIGTARP as a firm will greater than pay for itself. And also with 142 continuous. criminal examinations, consisting of those into execs at 64 different financial institutions that either. related to or obtained tarpaulin funds, we still have a whole lot more job to do. For Treasury and tarpaulin the outcomes have actually been extra mixed. While it is absolutely good news,.
as Mr. Massad kept in mind, that the price quotes of TARP prices have decreased, as well as substantially,.
And too typically Treasury, in its statements and in its testimony, has. Property Alleviation Program.First, it ignores the extremely significant wholesale.
components of the TARP program. Frequently these programs have actually been noted by loose compliance,.
failures in openness, as well as doubtful decision making. And also it is those really preventable. failings, as high as anything else that Treasury might indicate, that represent several of the.
deep unpopularity of TARP.The second price is perhaps one of the most significant.
of tarpaulin’s legacy, the ethical danger and the ongoing existence related to institutions
. that are still regarded also big to fall short. When Secretary Paulson, in 2008, and afterwards Assistant.
Geithner, in 2009, talked to the financial markets and guaranteed that they would not allow. any one of our largest economic establishments stop working and also would utilize TARP to be backstop them,.
they did greater than simply reassure troubled markets; they sent out a powerful message that.
these companies, these banks, would not be delegated suffer the repercussions of their very own.
recklessness. And therefore, and also regardless of the passage. of Dodd-Frank last summer season, these establishments still delight in a benefit over their smaller sized. opponents, with improved credit ratings and also cheaper access to debt and also capital, consequently. of that implicit Federal government guaranty. Without a doubt, in many means TARP has actually helped blend that very same. poisonous mixed drink of implicit warranties and also distorted markets that resulted in the calamities. at Fannie Mae as well as Freddie Mac. Tarpaulin has also had blended success in conference. The objectives set for it by Congress, objectives that were made to address Main Street. as Wall Street.And while I agree with Treasury that they have actually satisfied the Wall
Road goals,. monetary, they did assist prevent a collapse of the financial markets, which certainly. had a benefit not simply for Wall Street, yet for Key Street, TARP has actually not fulfilled the goals. established for it by Congress for Main Road. And perhaps the most substantial as well as certain. Main Road goal of protecting home possession, its failings there have had a few of one of the most. ruining repercussions. That initiative, the Home Affordable Modification.

Program, needs to day been a failure. With estimates that over the life of this program. we are going to see possibly well in unwanted of ten million repossession filings on ten.
million various households during the life of HAMP, when compared to the Congressional. Oversight, a panel’s current estimate that no greater than 700,000 or 800,000 irreversible. sustained alterations, hope is escaping. And Treasury’s management of this program offers little reason for optimism.They continue. to refuse to embrace even the most basic metrics and also goals and criteria to determine success. They seem afraid to check or impose charges on the mortgage servicers, that everybody. can concur performance on this program has actually been absolutely nothing
brief of abysmal. And, consequently,. we remain to see spiraling down involvement quarter after quarter after quarter. Mr. Chairman, Position Participant, participants of the Committee, I thank you for this possibility. as well as I do anticipate answering any kind of inquiries you might have. [Chairman Issa]

I say thanks to the gentleman and. I thank him for his determine accuracy of 5 mins. I currently recognize myself for 5 minutes. Mr. Massad, since you are right here in behalf of. Treasury as the individual most educated, can you explain to us the Assistant’s statement. on December 2010, on TARP and related bailouts, when he claimed in the future. If we deal with a shock that huge, we might have to do outstanding points once more. You just do not. recognize what is systemic. I duplicate, you simply do not understand what is systemic and also what is. not till you know the nature of the shock.Does that suggest that the Secretary anticipates. that if a housing crisis occurs once more, or a few other shock– we are not chatting about. an external force, yet some other shock to the neighborhood– that we still have systemic. risk, as well huge to fall short, as well as the Federal government will can be found in and release the huge and permit. the small to fall short? [
Mr. Massad] Mr. Chairman, what the statement. ways, in my view, what
I believe the Secretary was claiming, was that we can not predict what. the future issues will remain in regards to threats to our system. [Chairman Issa]
Isn’t that specifically what Dodd-Frank and all these other legislations. have done? We were meant to eliminate also big to stop working; systemic danger was expected to. be handled by an evaluation, if you will, a vetting of whether entities were durable enough. now and in the future; as well as it is the reason that some
firms are still around and some. were folded. Isn’t that true? [Mr. Massad] You are appropriate, Mr. Chairman,. that that is Dodd-Frank’s function, and also that is what we are implementing. Dodd-Frank, after. all, was passed 6 months back.
There is a great deal of work to do to apply it
, and as well as. However the Assistant stated.
this well after Dodd-Frank. We have actually had Bank of America below before us on.
multiple celebrations. We have rolled Countrywide into BofA; we have rolled Merrill Lynch into.
BofA. I am not for breaking up companies or taking a hefty hand, but if Bank of America.
is as well huge to fail, after that shouldn’t we be firmly insisting that they be, and I am not suggesting. this, yet shouldn’t we be suggesting that they discover a method to not be as well huge to fail.
in whatever sort of divestitures they require, as opposed to putting them because classification,.
I assume Dodd-Frank offers
us the.
So I assume it. offers us specifically the devices you are discussing. If I can react extra generally, I think the worries that Mr.Barofsky elevated are certainly.
those that animated the Congress in passing Dodd-Frank. Those are the actual issues that.
Congress discussed in passing Dodd-Frank. [Chairman Issa] Well, as somebody that was.
on the seminar for Dodd-Frank as well as someone who has actually existed all along, Dodd-Frank was.
And also I value the reality that it. Maybe the next time General Motors obtains in problem, we will close them down as.
Relocating on to HAMP, as the IG record says pretty completely, we can not score success by just.
The objective of HAMP, 3 to 4 million financings;. Would certainly you please provide me your sight of HAMP based on those numbers and also. It is extremely dispiriting.
This was the program that was supposed to help Key Street. I indicate, when TARP was initially.
passed, when you, the Congress, gave Treasury the $700 billion, the initial concept was that. Treasury was going to purchase toxic possessions, which were greatly mortgage-related assets.And.
the suggestion of consisting of an objective of preserving own a home in the statute was to attend to.
Rather, we have a program, and the numbers that you just indicated, it is simply not working. Out of the $50 billion initially alloted, now about$ 45 billion, only $1 billion has. Even extra frustrating is that Treasury will not give us its expectations.
understand what their run rate is, what they anticipate the complete number to be.
They must have a goal.

Legislative query, Mr. Chairman. Thank you, Mr. Chairman. Thank you, Mr. Chairman
. Mr. Chairman, Position Member, members of the Board, I thank you for this chance. Mr. Chairman, what the declaration.And also if they don’t have a goal, well, they require to have one. We can not repair this program
up until we have really details criteria regarding what the program is attempting to achieve
of keeping people in their homes.Not people

who obtain test modifications that stop working, which
was among the criteria that have been used; not the variety of people that obtain deals for
trial modifications. The amount of people are going to obtain modifications that are really permanent
I thank the gent.
time has actually ended. I identify a member of this panel who has
a deep passion in those adjustments becoming permanent, the Position Member, Mr. Cummings.
Thank you extremely a lot, Mr. Chairman. Mr. Massad and also Mr. Barofsky, the title of
today’s hearing is Bailouts as well as the Foreclosure Crisis. On the very first issue we have some motivating
information today on tarpaulin and also its outlook for American taxpayers. The SIGTARP record provided this
morning has increasingly desirable analysis of TARP’s economic successes, is that right,
Mr. Barofsky? That is absolutely proper.
[Mr. Cummings] And also below is what it says,”” On the economic side, tarpaulin’s expectation has never
been much better. Not only did tarpaulin funds aid head off a catastrophic financial collapse,
by price quotes of tarpaulin’s supreme straight financial costs to the taxpayer have actually fallen considerably. While Treasury’s ultimate return on its investment depends on a host of variables
that are mostly unknowable currently, TARP’s economic leads are today far
much better than any individual can have risked hope just 2 years back.”.
This is terrific news for the American taxpayer, however the report properly warns that there.
is still difficult work in advance, and it is very important that we proceed solid oversight.I have.

long required strict oversight of the TARP program, a program proposed by Head of state Bush.
in 2008 and established after considerable improvements by Congress. I previously asked for, gents,.
that SIGTARP audit the numerous numerous dollars AIG expended on bonus offers. I.
led 26 of my colleagues in asking for that SIGTARP audit the repayments made to AIG’s.
counterparties. That claimed, I am very concerned about the severe.
allegations of misuse by the home mortgage solution industry. Today’s SIGTARP report calls their.
efficiency abysmal and also defines nearly daily accounts of errors and also more significant transgression. The SIGTARP record additionally claims this, “” Unscientific proof of their failures has actually been well chronicled,.
from the repetitive loss of debtor documents– as well as my components tell me about that.
— to the outright failing to follow program standards, to unnecessary delays that significantly.
injury customers while profiting servicers themselves. Stories of servicer carelessness.
and transgression are myriad.” Mr. Chairman, we can refrain a thorough.
examination of the foreclosure situation without hearing from the market. That is why I sent out.
a letter on December 21st asking you to hold the Board’s very first hearing on the extensive.
utilization of flawed and illegal methods throughout the home mortgage industry.This has.

been my number one concern, as you said, and also I thought that we would relocate ahead. It is the very same factor I sent you an additional letter on Monday asking that you include an industry.
Mr. Chairman, and also to our witnesses, allow me go to you, Mr. Barofsky. The servicers,.
what are you all doing regarding them? I mean, Federal government has a function, the servicers have.
duty, as well as I am simply wondering what is occurring with that. And I ask you the very same point, Mr.Massad.

And also be short.
[Mr. Barofsky] Well, at SIGTARP we exercise our jurisdiction as we can, as well as our one area.
of territory over the servicers is, one, to examine them if there is any criminal.
conduct, and also we do have ongoing examinations in that area. The second point we can do is.
use our audit feature to do evaluations of the servicers, and also we have that recurring as well;.
we are doing an evaluation of their performance under the web existing worth examination and other.
aspects of their efficiency. What we can refrain from doing is what Treasury can do,.
which is wield a large stick, along with the carrots that it offers the servicers, as well as.
impose substantial, hard punitive damages, since that is where we will certainly hit them where.
it injures. We have to maintain this program from being volunteer not just in involvement.
For the servicers, but in compliance. Well, that leads me ideal to.
you, Mr.Massad.

What are we performing with regard to the servicers? Since there have actually been.
some hideous stories about what servicers have been doing. And also what impact do they have.
Congressman Cummings, I agree.
that the servicer performance has been abysmal, which is something that we have been attempting.
to repair. Allow me first explain this is a volunteer program. Congress really did not provide.
us the devices to enforce penalties, as Mr. Barofsky is suggesting. What we have is the capacity.
When they enter a permanent adjustment, to hold back settlement. A great deal of the problem was we.
could not obtain them to obtain the irreversible modifications done. So we deal with them to alter their.
performance. Currently, there are a variety of other things that.
We can’t, through HAMP, change the whole sector’s behavior; this is.
a model. This is an industry that is damaged. It didn’t work.
Well, can you inform me this, as my time runs out? Is the Justice Division.
associated with anything that you are doing? [Mr.Massad] Yes, they are. They are entailed.
in the interagency job force, as are all the Federal bank regulators, and also there is.
a lot of job being done on what sorts of reforms are required. There is also function being.
done by the FHFA in terms of changing the fundamental economic framework of the organization,.
because they simply weren’t prepared for this crisis and also aren’t able to deal with.
These are people that make.$ 50,000 a year.
To kind of create it off and also state, well, it is a failure I assume is. Currently, the factor we have not reached three.
We don’t help. We do not assist people that have trip houses. When you go through that as well as you understand that is the qualified populace, we have really.
We had 1,000 individuals turn.

out for an event in Las Las vega. So while we have attempted to include most.
of Mr. Barofsky’s pointers about the program, besides perhaps the one that he.
said we need to fingerprint individuals or thumb print individuals prior to they get a mod, which.
we decreased to do since we didn’t really feel that was suitable, I assume the program.
is actually helping a great deal of individuals. [Mr. Cummings] Thank you, Mr. Chairman. I. see my time has actually ended. [Chairman Issa
] I give thanks to the gentleman. The gentleman from Ohio, Mr. Turner, is identified for five minutes. [Mr. Turner]
Thank you, Mr. Chairman. Gentlemen, thank you for being below and thank. You know, I believe both.
Tarpaulin since I am from Ohio, ground absolutely no for

the home loan repossession crisis.
When they. came and said they were going to be buy harmful possessions and also that these were mosting likely to have worth,. Due to the fact that I have actually walked these neighborhoods; I have actually spoken to the, I knew they did not.
families that have actually lost their homes. And the brief tarpaulin expense was not specified.
As you have claimed, Mr. Barofsky, and I greatly appreciate, that you not only look at what. you are attempting to relax, but what they started with.
This was a really undefined costs, a very. undefined process, and also I believe there are billions that have actually been lost. I am very concerned about. the HAMP program since if we aim to what the Commission had said, that this was preventable,. that suggests that family members were made use of, which indicates families were taken benefit. of and also lost their economic future.
As well as HAMP came forward as apparently a Federal government. answer that is mosting likely to help them, that is going to state we identify that there was a. Federal problem here and also as
the banks, all individuals that, as a result of their greed, had actually perpetrated.
this, we were mosting likely to step in and help them.But it is not aiding them as well as, Mr. Barofsky,. I intend to thanks for the information that you supply us. When you get these last numbers and do the department, we are going to have spent an unbelievable.
quantity for each and every of the lending alterations that happened while doing absolutely nothing to quit.
the document foreclosures that are still taking place. First off, Mr. Barofsky, I think, when.
we take a look at the utmost numbers, we are mosting likely to wish to identify what portion of these.
individuals who did eventually get car loan alterations could have gotten them in the markets, definition.
that there was no subsidy that would certainly have been required; two, the amount of of these are going.
to fall short anyway because those are lost bucks additionally; and after that what are the per unit costs.
ultimately. Can you speak with that for a minute, regarding.
just how we are going to be able to then really evaluate what was invested? We can already tell.
that it is a failing, as well as thank you for your words of that, however just how are we mosting likely to assess.
the waste? [Mr.Barofsky] Well, I assume one of the excellent. information facets of the HAMP program, to the level that there is great information, as well as it is shown. in CBO’s loss quote,
is that the program will not invest also close to the amount of. money that is assigned for it.
Cash only obtains invested when there is real success. So the extremely reduced numbers of modifications indicates that an incredibly tiny amount of cash. will be invested. As well as that is why we have just had–
as well as, as I claimed, I think twice to use the. word just– it has just been a billion dollars
out of the 45 that has actually been spent. Far.So to the level that there is great news,.
it is that it

will certainly not cost the taxpayer anywhere near the assigned quantities. Of course,. that distinction truly births that any type of sort of claim of success for the incredibly small. numbers of adjustments that are originating from the program don’t
compare with what was. originally meant. As well as the benefit of not having any type of actual goals,.
real purposeful goals or benchmarks is you can assert success any place you want and also
claim,. hello, that is a success. And also I do not imply in any kind of means to demean or say that this program.
isn’t very crucial to those people who are appreciating it and also have the advantage of these.
important sustainable permanent adjustments in any type of means, yet I additionally assume the concept that. the reason why there aren’t more is since there are millionaires living in mansions.
which is why.There are a great deal of people around who are struggling very, extremely
hard.

that could gain from these modifications. [Mr. Turner]
Mr. Massad, I believe that the. And currently we have Tarpaulin and Treasury is entailed.
is being progressed. Just how can we trust what Treasury is performing in this? [ I am pleased to react to that, Congressman. If you could do so quickly.
Mr. Massad] Certain. As Mr. Barofsky kept in mind,. we just pay cash if there is a long-term adjustment became part of, if we in fact. aid a person participate in a permanent alteration, and we just spend for as long as that modification. continues.There is an integrated taxpayer defense element to this. So your inquiry regarding system cost
is a great concern, sir, and, in truth, it is structured. That it is a device cost program below. We won’t spend all the cash if we don’t.
become part of enough alterations. Which cash won’t be invested for anything else
;. it will return to pay for the financial obligation. That is leading. Phone number 2, as we claimed, the eligibility requirements here I assume are an additional manner in which we safeguard. taxpayers, because we just spend for individuals that we think are greatly in requirement.
As to your general concern here on the home mortgage crisis, obviously there is a great deal of research. of this. The FDIC launched its record today and I believe it noted that there is blame to.
go around in a lot of locations. I think we should remember tarpaulin was just established
to provide the. sources to stabilize the system; it didn’t change the regulatory structure.We now have. Dodd-Frank, which offers us brand-new tools to control the monetary industry so regarding prevent this. kind of problem in the future. [Chairman Issa] Thank you, Mr. Massad. The Chair now recognizes the previous chairman of the Board, longstanding participant of the. Committee, Mr. Towns of Brooklyn, New York. [Mr. Towns] Thanks significantly, Mr. Chairman.
Allow me first say thanks to both of you for being below. You understand, I obtain the sensation that we are sort. of criticizing each other, which bothers me due to the fact that people are shedding their houses. I want. you can just spend and also come eventually in my workplace and just listen to people that are coming. in and the stories that they are informing. I suggest, a few of the points they are claiming. is the reality that they made an application, suddenly the application is lost; they.
phone call and also they say, no we never ever obtained your documents, when they actually offered the documents. As well as after that the other one, which is actually one that they are claiming that is truly becoming. a problem is that when they call back the fourth or third time, the individual no much longer.
works right here, so you need to learn that you were dealing with.And, certainly, if the.
As well as I saw you indicated, Mr. Massad, that the Congress really did not offer you the power,. I suggest, this is a dilemma, and also I am wishing that– I want to join you, Position Member,. Mr. Massad]
Congressman, I concur with your. issue. I think you are absolutely. We have tried to do what we can via HAMP. to place in a lot of customer protections.For instance, we have actually called for the servicers, if.
There are a number of other. We have actually placed in phone call centers, acceleration centers, and also a lot.
try to help them. I believe in terms of the overall industry,. a great deal of interest requires to be paid to this, as well as I assume a great deal of work is taking place, and also. much more will be needed, and I make sure this Congress will need to consider it.And a lot
of people. have chatted regarding whether we must have nationwide maintenance criteria.

Individuals have noted that. the basic financial version of maintenance does not function. Servicing works when you have carrying out. home loans, the servicers gather the settlements and pass them on to the financiers.
When it comes to dealing with a dilemma like this or foreclosures, they are not outfitted. to do it. I believe we have to look at things like maintenance standards.
Job force is looking at a number of issues, the regulatory authorities are. I believe there.
Mr. Barofsky, what are the penalties that you are talking concerning? Exactly how can we arrange. Since something needs to be done.
Mr. Barofsky] Absolutely. As well as I assume that, as Mr. Massad claimed, there are discussions. of nationwide maintenance requirements, and I assume that Chairman Bair of the FDIC has actually placed out. some terrific concepts that would be great for all servicers, and I assume a great deal of these. ideas might be adopted and also brought right into the HAMP program with extra directives. Monetary charges based on withholding repayments to the servicers. Treasury discussed. an offer when it obligated about $30 billion to the home loan servicers for repayments, as well as. that consists of the capacity to keep payment and also impose monetary penalties.To the level. that those fines are not strong sufficient or sufficient, well, that truly drops on. Treasury for not bargaining a better deal.
This is not the most unforeseeable opportunity,. And Treasury had duplicated cited their capacity to enforce monetary fines as something,. Mr. Massad]
If I can just respond to that. If they haven’t gotten in into extremely lots of long-term. As this Committee knows.
170,000 irreversible modifications, as well as a whole lot of people said then the program was a failing. What we did because that time was we had a number of restorative actions we made the servicers. Mr. Chairman, I see.
my time is up. I think that if there is something that we need to do, I believe you.
need to claim it, due to the fact that we just can not remain to let individuals shed their houses.
Thank you really a lot, Mr. Chairman. Thank you, Mr. Chairman. My inquiry to you, Mr. Massad, is do you.
Congressman, it depends on–. Mr. Massad]
Congressman, if I can respond to. the question– [Mr. McHenry] I have five mins, Mr. Massad. Yes or no? In fact, let me start
by asking do you think HAMP is successful. [Mr. Massad] I do. [Mr. McHenry] Okay. So do you believe under.
present arrangement of regulation you have sufficient authority to ensure that HAMP is successful? [Mr. Massad] I can not fix the real estate crisis with HAMP alone, if that is the meaning of. your question.But I believe aiding over
500,000 people participate in irreversible modifications,. individuals who would certainly or else be tossed out of their homes, people that make$
50,000, and also.

Since they are currently living next to a house, their areas would be hurt by that.
that can be vandalized; it dispirits their property values, it is a drag out the economic climate. I think, yes, I believe those are dollars well spent. [Mr. McHenry] Thanks, Mr. Massad. Mr. Barofsky, in your written testament today. you laid out that there are 2.9 million homes who received repossession filings in 2010,.
up from 2.8 million in 2009 as well as 2.3 million in 2008. Can you discuss your findings on.
the HAMP program? [Mr. Barofsky] Yes.

Thank you extremely a lot, Mr. Chairman. Mr. Massad and also Mr. Barofsky, the title of
Mr. Chairman, and to our witnesses, let me go to you, Mr. Barofsky. Thank you really a lot, Mr. Chairman.
And also I assume that, as Mr. Massad stated, there are discussions.I mean, once more, not to
reduce the favorable influence it has on those families and those that have the ability to remain in
the program, but you have to look at what the program was anticipated to do, as well as you have
to consider it in the context of the whole foreclosure crisis, as well as what this program
was intended to do.And the benefit of never ever in fact placing out meaningful objectives indicates
you can proclaim success also when you have, looking at a total amount for this entire program
of 700,000 to 800,000, when you initially anticipated to assist 3 to 4 million, even
when you have only invested $1 billion of the $45 billion that you designated. This program, if it aids five individuals, that is terrific for those five people. Yet what regarding
all those countless individuals who are not obtaining help, the numerous people that Treasury
and also the Administration recognized at the actual start of this program of who they were
mosting likely to attempt to help keep in their houses by changing their home loans to a sustainable
level? As well as the numbers don’t exist. When I hear them proclaiming success with these exceptionally, and
modest numbers, numbers that are so modest that they can not also have sufficient money to
pay to impose financial penalties, it is heartbreaking to a particular degree because it means that
they won’t identify and also make the changes that are essential to make this a far better program,
Thank you, Mr. Barofsky. Relocating
on to the little organization lending front, in your report you ask for that Treasury eliminate
Tarpaulin possessions and also equity from the entity’s annual report for functions of assessing its
application for the Small company Lending Fund. The intent of the Small company Borrowing
Fund, certainly, is to boost lending. Has Treasury been open to your proposal?
[Mr. Barofsky] Treasury has actually turned down that recommendation.
[Mr. McHenry] Mr. Massad, why did you turn down that?
[Mr. Massad] Because we desired to see to it we followed Congress’s directives in
Certain. Mr. Massad]
We did not think that Congress was instructing us to basically penalize those institutions that had currently received TARP funds. Quite the contrary. [Mr. McHenry]
Mr. Barofsky, under your reading of the regulation, do they have provision to do this? [Mr. Barofsky] Absolutely. Congress specifically made an arrangement in the regulation that gave the Secretary of Treasury the capacity to fashion specific policies for TARP financial institutions to become part of SBLF. There is nothing in the statute that provides you an issue of right, by being a tarpaulin recipient, that you automatically obtain to make an application for as well as– well, you get to obtain it, yet that you immediately obtain transformed right into SBLF.
SBLF offers remarkable benefits to TARP recipients who convert, as well as the taxpayer loses on a whole lot
of those, as well as our suggestion is a simple one: allow’s see to it that the financial institutions that you have taken out of tarpaulin and put right into SBLF are properly capitalized to fulfill the goals of this program.We are not stating punish TARP financial institutions and claim none of them can obtain brought right into the program.

Never. Yet we do assume that it is necessary for Treasury to be extremely liable and also make certain that those that are going to get the benefits of being in SBLF, at taxpayer expenditure, are well suited to be able to do the borrowing, new financing, new incentivized financing from Federal government capital; as well as, truthfully, we believe that those banks need to
be dealt with as various other candidates who enter the program. For instance, when a financial institution requested the CPP
, they didn’t reach consider Federal government resources of whether they passed or don’t pass; which must be the very same criterion here.The reality that these financial institutions have the advantage of Government capital, frankly, we don’t. think always that that capital needs to count when making that examination.
I thank the gentleman.
[Mr. McHenry] Mr. Chairman, I know my time has expired, but I would ask Mr.Massad to.
respond in contacting this extremely subject. We are interested here in this Board, as well as.
if you have worry that you do not have appropriate provision of regulation, we want to. change that.

[ Chairman Issa] The gent consents to respond. I thank the gentleman.
The Chair now acknowledges the gentlelady from. New York City, Mrs. Maloney. [Mrs. Maloney] Thank you. I would certainly such as to thank the panelists for their public solution and also report some good.
information in that the DOW simply went across 12,000 for the very first time considering that June of 2008; as well as that. shows resources is moving again and is an extremely great sign of financial healing in our excellent.
Country.And, from your testimony today, tarpaulin contributed in moving us in this excellent direction. You explained that it not just prevented a meltdown, but laid the groundwork for financial.
recovery

, which we are seeing today. I need to say that throughout the dark days I was. getting phone telephone calls in the middle of all day as well as the evening long from components who were. terrified of a collapse.
There was a work on the cash market on some banks, and I personally.
believe that my ballot in assistance of tarpaulin will traditionally be concerned as the right point.
to do and also great public plan, although all of us who were on the project path, several.
I would certainly like permission to put in the record one of the ideal reports that I have actually seen on. Chairman Issa]
And additionally a write-up in the. American Lender which speaks regarding the residence
foreclosures repossessions as well as foundation structure is working. Chairman Issa]
So purchased. [Mrs. Maloney] I particularly wish to. reply to both troubles that Mr. Barofsky discussed in his testament
; first, the price. of TARP in regards to confidence in our Federal government, transparency as well as other monitoring blunders,. and also I would like to discuss that I authored a bill in response to your initial objections. on this what would have computerized TARP in realtime so we would know where the funds. are. It passed your house backed by the Chamber of Commerce and Labor, among the couple of bills,. as well as I truly believe we ought to do it for the whole financial system. If we can track where. our package remains in two seconds, we should be able to track where we remain in our direct exposure. in finances.I feel it is an essential expense and also one that we need to service and also overhaul. to the current status. You likewise mentioned the too big to fail and. the reality that your issues that we may not have actually done enough. I would certainly such as Mr. Massad. to react to this, specifically in the Dodd-Frank

costs. And also I was similarly on the Seminar. Board with the Chairman. We developed a Financial Security Oversight Council to check. the systemic risk as well as to establish criteria to recognize establishments that may be increased risk
. I would certainly like you to discuss the standing of where that is. We likewise, very importantly, established an orderly wind-down, similar to what we have. in the FDIC, which was a massive success.We had
two choices: we can either release. an establishment or allow them fall short. Neither was a great service. We wish to have the ability to wind. them down as we had the ability to do with FDIC financial institutions so efficiently. As well as I need to know.
are the rules in shape and where does that stand.

Third, we enforced resources requirements and take advantage of ratios to guarantee that huge organizations. aren’t taking too much threat.
I believe those policies are appearing in July. Correct. me if I am wrong.And where does that stand? Where do you
think the utilize as well as funding. demands will come out, in your best judgment? We called upon the SEC to come up. and also we provided, in fact, new powers as well as authority and resources to pursue negative actors. to make sure that we
could locate the following Bernie Madoff and also assist safeguard our system. So I would certainly like you to respond to where these campaigns stand. What do you recommend,. if anything else, we require to do to secure us from as well big to fail, as was pointed out. in his testament? And also, if you have enough time, might you reply to TARP as it relates. to the taxpayer? We understand it was a lot for our economic climate; it was a large amount for avoiding. economic risk. I am the daughter of 2 parents that endured in the Clinical depression. Their tales. were awful. We avoided that in our economic situation, however was it a great bargain for the taxpayer? Thanks quite for your service.
[Mr. Massad] Congresswoman, I would. be delighted to reply to all those things. Let me begin, maybe, with the last point.I. appreciate that individuals that are still suffering from this crisis, as well as there are lots of, may. not really feel that TARP didn’t do anything for them; as well as Mr. Barofsky also has actually asked what. did it provide for Key Road. I assume the study you explained, the Zandi research, makes it.– [Chairman Issa] I would ask unanimous authorization.
for an added one minute for the witness to react. Without objection, so bought.
[Mr. Massad] Thank you, Mr. Chairman. The research study makes it extremely clear we would certainly have. become part of a 2nd Great Anxiety. We might have faced unemployment, in their quote,. above 16 percent; other individuals have stated 25 percent. The fact that we averted that is. an actual benefit to Main Street.
The fact that individuals can currently borrow once again, when they could not. I don’t think one has to look really much to understand that. As to the progress in executing Dodd-Frank, a lot of work is going on.
I assume you will certainly see a lot of work going on there.As to capital ratios, they are functioning.
They are currently higher. In other words, our monetary.
system today is better capitalized than it was in the fall of 2008, and also many of the.
organizations are a lot better capitalized than their foreign rivals. The various other point I want to keep in mind is– [

Chairman Issa] If you could sum up quickly,. please. [Mr. Massad]
On small banks, we funded over 400 tiny banks under Tarpaulin, and that is an additional benefit to. And as to Congressman McHenry’s point on the SBLF, undoubtedly, Treasury supported this.
brand-new fund, and also I believe the only problem is a small one that Mr. Barofsky is elevating, because,. really, Treasury does make a new credit rating choice on whether a tarpaulin recipient is eligible. It is not allowed to refinance.So there is if a Tarpaulin recipient hasn’t paid its rewards. a new credit history decision made. He is simply increasing a particular factor which we really felt the statute. did not allow us to do. [Chairman Issa] I give thanks to the gent. The Chair currently identifies the gentleman from Ohio, Mr. Jordan, for five mins. [Mr. Jordan] Thank you, Mr. Chairman.

I want to thank
the gents for being with. us today as well as, Mr. Barofsky, you and your team specifically for the integrity as well as professionalism and trust. that you give your work. We certainly value that. Your remarks earlier were that the. HAMP and the making home budget friendly programs, their efficiency incredibly dispiriting. In today’s Journal there is a quote that the repossession initiatives at Treasury has actually been. beset by troubles from the beginning as well as, despite regular retooling, continues to fall substantially. short of any kind of meaningful criterion of success. The article takes place to discuss regarding the FHA. brief re-finance program, which started last loss as well as has actually assisted 15 people. I presume my concern is at what factor do we say, hey, this just isn’t working, this. simply isn’t doing the job? Would certainly
we be much better off simply discontinuing the whole. program? After three years, three to 4 million goal, a few hundred thousand in long-term. alteration have in fact had help.The Treasury discusses now the statistics they are utilizing. is using individuals assist, versus in fact offering it. At what factor do we say, hey, this is. simply not working, allow’s end this program? [Mr. Barofsky] I proceed to be a glass fifty percent. full sort of person. [Mr. Jordan] Well, based on your comments.
on this, Mr. Barofsky, you would certainly

n’t be a glass half full, you would be a glass 2 percent. complete, or 1 percent complete. [Mr. Barofsky]
That is real. I am a positive man also, we live in America, but that is truly extending. Mr. Barofsky]
Well, I think that hope is. And I assume the means for Treasury to respond to that is not to keep sticking for these. I believe if they fail to do so you are possibly dead-on.
right. [Mr. Jordan] You have much more persistence than I. have.
The other day I presented, likewise the co-sponsorship of the Chairman and also the.

Ranking Member
on the Committee, Congressman McHenry, we presented legislation to finish. the HAMP program.
We just assume any unbiased look at this, it doesn’t require proceeded. spending of taxpayer bucks. Now, I wish to be clear on a pair points. You have jurisdiction over the $45 billion in the TARP program that impacts the repossession. programs, HAMP being the biggest one. There is also$ 25 billion that is offered. to Treasury in the Housing and also Financial Recuperation Act. Is that accurate? [Mr. Barofsky] That cash is cash that mosts likely to Fannie as well as Freddie. [Mr. Jordan] Okay. And also I recognize this is not your jurisdiction, but to the level you. recognize, has any one of that money been related to or used whatsoever for repossession avoidance. kind programs at Treasury? [Mr.Barofsky] Yes. [Mr. Jordan] And also, if so, are the outcomes comparable to what we have seen in HAMP? [Mr. Barofsky] Well, really, yes
. We are truly speaking when we are talking concerning HAMP. regarding both elements, the GSE money, which is not funded via the taxpayers,–. [Mr. Jordan]
Right. [Mr. Barofsky]

— and after that the tarpaulin. And,
truthfully, to day, the GSE part of the program is doing far better than the tarpaulin part. of the program. Of this 520,000,
about, or 540,000 of ongoing long-term adjustments,. majority of those are attributable to Fannie and also Freddie and the GSE. It is just. about 220,000, 230,000 modifications that are really tarpaulin long-term alterations. So there is activity there, as well as we information in our report, we break all these numbers. below GSE versus non-GSE, including just how much money
the GSEs have actually reported that they. have actually invested in these alterations providing to servicers.
[Mr.Jordan] The bottom line is there is about$ 70 billion that has actually been.
$ 70 billion, not 45,$ 70 billion,. Is that accurate? Mr. Barofsky]
Yes

. And as I claimed, I. recognize your frustration, and I share your aggravation.
I just wish the Treasury can. hear what you are stating and also hear these legal intent, as well as come up and also be honest about where. this program is going, if it is going anywhere.
[Mr. Jordan] And also allow me simply complete this,. I have 15 secs. And also to place everything in context, $70 billion appropriated for this, not helping. the individuals it is made to help, total failure
. The individual that is billed with inspecting it. recognizes total failure, each time we have a$ 14 trillion nationwide debt.At some point. we have to state sufficient suffices, allow’s finish this program. Mr. Chairman, I produce back. [Chairman Issa] I give thanks to the gentleman. The Chair now accepts the gentleman from Ohio, Mr. Kucinich, five minutes. [Mr. Kucinich] Mr. Massad, isn’t it real that HAMP’s efficiency depends on. the volunteer willingness of mortgage servicers to give distressed customers funding modifications? [

Mr. Massad] Yes, that is appropriate. [Mr. Kucinich] Mr Barofsky, isn’t it true. that personal home loan servicers have actually discovered creative methods to frustrate efforts by troubled. customers to conserve their residences? [Mr.Barofsky] There have actually definitely been issues. with home loan servicers.
I do not understand if it has been imaginative, but it definitely has actually happened. Because it is conveniently noticeable that the party actually responsible for HAMP’s. The minority asked for that JPMorgan Chase, a significant servicer, show up today.
Would the gent yield? Mr. Kucinich]
, if the Chair will certainly allow me have my time later on.. [Chairman Issa] Of program. The Chair chose that today would be fully entailed. with the Government’s side and the Special IG’s record. We do mean on having, amongst. others, servicers as well as a review of the HAMP program. This is yet the initial of our exploration. And also I value the gentleman’s remarks and generate back as well as will include 20 seconds. [Mr. Kucinich]
I appreciate that. Now, SIGTARP’s report and various other records. of abuses by finance servicers, Mr. Chairman, raises severe problems that these mortgage. companies may be engaged in a pattern of misuse. Mr. Barofsky, I would
like to request that. your workplace conduct a particular audit on this concern. And also I wish to, at this factor, ask the Chair if you would certainly accompany me in this request,.
since you are stating that you are willing to go forward with looking at the home loan. servicers.
I will definitely consider. Would certainly you provide me the demand in composing? I will do that.Because what.
I desire to point out, thank you, Mr. Chairman, is that while the Chair absolutely has the. It is reassuring to know that you will take into consideration calling witnesses in the home loan. In this situation, and I am not claiming this happened, however my.
concern would certainly have to do with that plan is that if there is any kind of interaction with the Board.
As well as I am additionally concerned that if, on this issue of JPMorgan Chase, servicers not showing up.
That is just one of the troubles. in not having opening statements. I really hope that as we proceed down the road. in this Committee, we will recognize the importance of custom and treatment that.
Currently, Mr. Massad, what is Treasury doing to. Mr. Massad]
Thank you, Congressman, for the. question, it is a really vital concern.
Let me talk about some of the points we have. We have actually needed the servicers to, if they are assessing somebody for HAMP, they.
And also if they decide that the person isn’t qualified for. HAMP, they need to still consider various other options; short sales, proprietary alterations, as well as. Forth. And also it is just after they have actually certified that
they have done all those points that. you can continue to a foreclosure.We have required the servicers to have a process. for appealing the choice. We have actually additionally established our own center so that people can come. to us if they feel they have actually been mistakenly denied, and we will certainly run an estimation to provide.
them a sight on that. And also we have an escalation center that manages grievances. [Mr. Kucinich] Well, let me ask you this. Would certainly you agree that we will certainly never ever reach.
all-time low of this issue or find out just how to proactively manage the repossession situation.
Who alone make the choice around if we don’t examine the activities of home mortgage servicers.
that may keep or must leave his or her house? [
Thank you, Mr. Barofsky. Mr. Chairman, I recognize my time has run out, but I would certainly ask Mr.Massad to.
Thank you, Mr. Chairman. Mr. Chairman, I generate back. I want to aim out, thank you, Mr. Chairman, is that while the Chair absolutely has the.Massad] I would certainly concur, Congressman, that
we require to check out how this entire market is working or, rather, not functioning,
as well as I believe there is a lot of job going on. As well as obviously via HAMP, which, as you
have kept in mind, is a voluntary program, we can not require a chance on the whole sector. But
we have found out a great deal, we assume, about what is–
[Mr. Kucinich] Mr. Barofsky can examine it.
Yes, Congressman. And, by the method, we do have a recurring audit of the mortgage
servicers, and I will make certain that my staff meets your personnel to see if there are
any particular concerns that we must integrate into that reveal.
[Mr. Kucinich] I believe it is also crucial you communicate with the Chair on that particular as
well. Is my time expiring or do I have 20 secs
The gent has 20 additional
seconds. [Mr. Kucinich] Thanks. This is so important to my constituency since Cleveland, Ohio has actually been an epicenter of the
subprime meltdown. Individuals have lost whatever they ever before worked their life time for, as well as when
you obtain in a circumstance where they rely on HAMP to try to conserve their residences and also the home loan
servicers have a subterfuge to beat that, it is very important we call them to a bookkeeping. Say thanks to you.Thank you,

Mr. Chairman.
The gentleman is most welcome. The Chair currently recognizes the gent from
Florida, Mr. Mack. Thank you, Mr. Chairman. I desire to say thanks to both of the witnesses for being here today.
in hard times, allow me just say I make sure it is difficult to rest there as well as take the concerns,
There is a great deal of disappointment. I wished to begin by stating this, that
my monitoring so much is that what we are discussing is failed government guidelines
as well as programs, and today is what we are speaking about, or some people are speaking around, is
what other federal government programs can we include on top of that to attempt to make the failed ones
job, as if, though, a lot more government law, even more federal government programs is mosting likely to be the
answer.And I have heard a couple people from Ohio
speak about Ohio being the epicenter of foreclosures. I would welcome them to come to Fort
Myers, Florida, to Lehigh, to Cape Reefs. And I will tell you what my components are
We do not desire the concept that government is going to resolve all of the issues, when a.
lot whole lot people individuals like government federal government part component the problem. If you believe about what has taken place, government began to press individuals as well as mortgage companies.
right into making financings and placing people right into houses that perhaps weren’t fiscally able to.
do that, either the individual.then or the business, when we have

a crisis, we then transform.
to more federal government and also managing it, and also what you obtain is, rather than banks being able.
to provide, if you talk with neighborhood financial institutions, they hesitate to lend since exactly what Mr. Massad, you need to consider what you said earlier. You said that we require to integrate.
some national criteria. When these lenders hear that, what they listen to is extra penalty. What they listen to is much more adjustments are coming; we don’t recognize what the guideline are;.
we hesitate to lend.When you bail out the huge financial institutions, it disadvantages the little banks. So when you discuss the prices of TARP or these various other bailout programs, what you are. missing is the expense of possibility from other sectors. So you have the big financial institutions that you. intend to case have done so well.
I don’t recognize that I see it in this way, but it has been. at the price of the small banks.
And also now what we are seeing is lending institutions do not desire to offer. Once again, what I am claiming is quit.
what is the next program, what is the next acronym that we are mosting likely to begin speaking.
concerning that is a failing due to the fact that government can’t do it. I intend to listen to from both of.
you, if you would certainly, really particularly, what need to we repeal. What kind of rescinds can.
we do that will assist spark borrowing as well as loaning, that is going to help local business.
or that are mosting likely to help households that are trying to place their lives back together. Rather than speaking about what brand-new programs we are mosting likely to pass, I would certainly like if both.
of you as well as, Mr.Massad, I will certainly start with you, if you can tell me what do you think.
we should repeal. [Mr. Massad] Thank you, Congressman. I am.
delighted to do that. Firstly, my obligation is the tarpaulin program. I am not a regulator,.
yet what I would certainly state is this. I am attempting to obtain the federal government out of business.
of having risks in private firms and telling private business what to do.
[Mr. Mack] Excuse me real quick. However when you claim now we require national standards, believe.
regarding what you stated and consider what people back home, think concerning those tiny banks. Think of individuals who are attempting to make it every day.What they

have just heard is.
the rules of the video game are mosting likely to transform once again, as well as currently you are saying we need nationwide.
I was referring to nationwide servicing.
criteria for the maintenance of home loans, which we currently have some. This company.
is mostly dominated by the large banks, the small financial institutions aren’t actually in it; the huge.
banks stand for the substantial– [Mr.Mack] Well, yes, since they can’t.
Because federal government has sided with one over the other, contend.
[Mr. Massad] Well, I believe– [Mr. Mack] Once again, if you boil down to Southwest.
Florida, the neighborhood financial institutions are so vital to real estate, but they have been pushed out.
since government has actually been available in as well as released the big banks. They can not compete.
[Mr. Massad] Congressman, I agree little banks are really important; that is why we funded.
many of them under tarpaulin. Once again, that is something we had to do. I do not think it.
is an excellent thing for the federal government to have actually to have done that, but we had to do it, and also.
that is why we are attempting to get out of it so quickly. However in regards to your talk about failed federal government programs, I believe all we are trying to do.
is state we still are in the middle of an extremely dreadful real estate dilemma that is a drag out.
our economic recovery, and also the servicers– [Mr.Mack] , if I can–.
–.
[Chairman Issa] The gentleman’s time has expired.
Time has expired. Mr. Chairman, if I can ask–.
[Chairman Issa] I would certainly ask consentaneous permission for one extra min. So purchased.
And also I will simply state this to the Chairman. If you would send to this Board.
for us, please, in composing, certain points that we can reverse that is mosting likely to aid,.
as opposed to sending to this Board what various other guidelines and also programs that we ought.
to be carrying out. I would such as to hear what you believe we should certainly reverse. Thank you, Mr. Chairman. [Chairman Issa] , if the gentleman would certainly yield.
.
his continuing to be time. [Mr. Mack] Yes. [Chairman Issa] As long as we are asking, Mr. Massad, would you devote, prior to the following.
quarterly Unique IG report appears, either to produce a modified price quote of the number of.
funding modifications you anticipate HAMP to create, along with the resource product provided.
to the Unique IG, or, in the option, provide to Mr.Barofsky the

source.
Yes, sir. I would certainly be happy to.
do that. We have been functioning on that and I think a lot of that data is out there.
we enjoy to do it. [Chairman Issa] We sure value it. I understand.
the Committee would certainly appreciate that. The Chair now identifies the gent from.
Massachusetts, Mr. Lynch, for 5 mins. [Mr. Lynch] Thanks, Mr. Chairman. Mr. Barofsky, Mr. Massad, thanks both for your excellent job as well as thank you for your service.
to our Country. Mr. Barofsky, I am extra aware of your job, particularly so, sir, the job.
that you have actually been doing. I do want to take just maybe half a minute to really deal with.
some of the revisionist background here on TARP.I elected versus TARP. When it came previously, as well as.
the Financial Services Committee and also prior to this Congress, the stated legislative objective.
of TARP was to help Key Road, to aid Main Street, the Struggling Possession Relief Program. And when we asked Secretary Paulson at the time, prior to the ballot, in fact, I think.
it was the Ranking Member on Financial Services stated why do not you simply take money and also things.
it into the financial institutions, the $700 billion that you desired. As well as Mr. Paulson claimed, no, we are not going to do that. We are not mosting likely to do that. We.
checked out that which will not work. Then 10 days after this costs passed, tarpaulin passed,.
they did exactly that, they infused all that money into the banks. This was the financial institution shareholder.
relief program. And also for people now to state, yes, this is precisely.
what we elected for, this is not what we elected. We voted to increase borrowing. That was.
the goal of the Congress when tarpaulin was placed on the floor.And most of

us saw the failings.
of that. And also to now say, oh, yes, we supported TARP for all the right reasons, I assume you.
have to accept the truth that tarpaulin packed essentially $700 billion worth of taxpayer cash.
right into huge banks, aiding out these investors. We paid 100 cents on a buck to Goldman Sachs.
because we pumped $14 billion right into AIG. It was a pass-through, it went right to Goldman.
Sachs. A hundred cents on a buck on credit default swaps that should not have actually deserved.
fifty percent that. We additionally travelled through thousands of millions.
of bucks to AIG FP staff members that mispriced this threat as component of TARP. They obtained paid off. They got rewards from taxpayer money. How you can take credit for that as well as say that.
that was an excellent thing.And it was never

a question of– I know people claimed, well, if.
And I just assume there are a great deal of weaknesses in this TARP program. I think, Mr. Barofsky,.
you have actually drilled down as well as obtained to a lot of them. I want to take my last couple minutes.
to discuss the servicing industry, since so much of the maintenance industry is discussed.
in this report and also I believe it is spot on. I intend to just speak about– I will just list.
all the investigations that are taking place now with the services. As well as we are not going.
after them in a meaningful way; I don’t think Treasury is. On October 13th, 2010, the Attorney general of the United States of all 50 States announced a joint examination.
right into whether several of the Country’s largest economic organizations are making use of flawed and.
built records to execute wrongful foreclosures.The Federal Reserve as well as

the FDIC and also the Office.
of the Comptroller of the Currency are now checking out whether systemic weaknesses.
in the market are resulting in incorrect foreclosures. On January 7th, 2011, the Supreme Judicial.
Court in my very own home State of Massachusetts invalidated house seizures because the folks that.
were seizing could not really prove they had the home loans. The USA.
Trustees Program has a similar program. The attorneys general of Arizona as well as Nevada are.
doing the very same point. The Justice Department. What are we doing regarding the solutions? Exactly how.
If we are not going, are we going to clean up this sector as well as correct these troubles.
right after the services? That seems to be where the trouble exists.
[Mr.Massad] I am satisfied to reply to that, Congressman.
[Mr. Lynch] Please. [Mr. Massad] Thank you for the question. You.
have actually described the activity that is going on by a range of Federal firms, and also it.
is under the auspices of an interagency task force that Treasury co-chairs. That is.
really crucial job as well as I believe we will certainly see some outcomes of those investigations, as well as.
I believe it will certainly help us figure out what sorts of reforms are required, as well as possibly some.
of those points will certainly be coming prior to the Congress. Allow me simply likewise, though, respond.I appreciate the truth that since this program was. announced as a way to buy struggling assets, and also then it ended up being a program where,.
a minimum of at first, what Secretary Paulson did under the Bush administration was to spend.
cash in banks, people were important of that. All I would claim to that is a pair points. One, I assume, under the scenarios, we had to make that modification; there wasn’t time.
to do the distressed possession acquisition as it was initially contemplated.Number two, we really did not.

do$ 700 billion, we really spent far less than that. [Mr. Lynch]
Five hundred thirty-four billion, if you desire a precise number, that went straight. to the banks. Still a great deal of cash.
[Mr. Massad] Congressman, if I may–. [
Chairman Issa] If you would certainly summarize your answer, please.
Sure. Regarding $250 billion went to banks, as well as most of that has been recovered.
Thank you, gentlemen. The Chair currently identifies the gent from Pennsylvania, Mr. Kelly, for five minutes.
[Mr. Kelly] Thanks, Mr. Chairman. Mr. Barofsky and also Mr. Massad, thanks for.
being right here today. Mr. Massad, in your opening comments you made recommendation to the car.
industry, of which I am a part of. I am an automobile dealership as well as a little service person. .
while people discuss local business and also their sight of it from 40,000 feet, I am in fact.
on the ground. I can inform you this: the Small Business Car Loan Fund is not working. And many.
financial institutions can not operate out of concern. The regulations that have actually been troubled these individuals makes.
it impossible to obtain accessibility to these funds. Now, why do I state that? Due to the fact that I undergo.
it on a daily basis. Not only myself, but individuals that I am in company with. And while I am.
a chosen authorities today, in my the real world I am a small company owner.I can tell you

,.
with someone that has all the skin in the game everyday, I would certainly recommend to you that.
while we happen with these programs and also we reside in this wonderful globe of phrases that.
really make sense inside this Beltway, in actual America it makes definitely no sense.
to anyone, and also these lendings simply are not offered. While we speak regarding this money.
that is available to assist us endure, the reality of it is that it is not available.
Currently, what has transformed? It is the guidelines.
me, as well large to fall short methods that I am too tiny to survive. Most of the financial institutions that I work.
with are tiny banks. They are absolutely frozen with worry. The laws and also the.
policies have actually placed them in a scenario that they can not operate with us on an everyday basis. Quarterly the covenants transform for me.And as we chat about local business leading.
the means out of this financial mess we remain in, I will inform you it is the unpredictability that.
everyone deal with. And also I am not speaking about big firms; I am speaking about Main.
Street America. I am speaking about the ordinary person, the guy that gets up daily and.
stress over it not just throughout company hours, however 7 days a week, 1 day a day. My only question to you, sir, and also I don’t understand what you can do concerning it, however there has.
to be some method that we can release up these funds to make it feasible for these individuals to endure. The people have despaired in this system.

[Mr. Massad] Congressman, that is a great.
concern and you increase a great deal of essential factors. Let me claim a couple of points. One.
is that what we attempted to do under TARP was, in part, reactivate the credit markets that assist.
local business, the securitization markets on which a whole lot of them in fact depend for.
finances; and I believe we have done well there. There is still a great deal of job to do to aid.
small business. I agree with you 100 percent; small company.
has actually been harmed in this crisis, little financial institutions have actually been hurt in this situation, as well as they have not.
totally recovered. The local business regulations that was passed last year, which established not.
only the Small Service Borrowing Fund, however additionally another program where the States are.
attempting to assist small companies straight, I assume provides some help.It might not be.

enough. I am pleased to discover with you further.
things that must be performed in that respect, because I agree it is a trouble that needs.
interest, as well as I assume the Treasury as well as the Obama Administration have actually attempted to take note.
And also I appreciate your remarks,.
I would tell you this: time is of the essence as well as we actually do not have– we are.
As well as I yield back my time, Mr. Chairman. The Chair currently acknowledges the gentlelady from Washington, D.C., Ms. Norton, for five mins. Ms. Norton]
Thanks, Mr. Chairman. As a predicate to my concern, I intend to keep in mind an.
post from the Abilene Reporter News describing what seems the Republican technique.
to the meltdown of homes, and also I ask consentaneous authorization that this be put into the document.
Without objection. Mr. Neugebauer is the chairman.
of the Financial Providers Committee. He is a former lender himself, and he is rather.
frank. He essentially says that the initiatives focused on cushioning the strike have all failed,.
therefore he states let the marketplace takeover. To quote him, “” Markets aren’t kind, but they’re.
extremely efficient.” Need to we go cool turkey and leave countless house owners out there.
to experience the effects? Since I have further inquiries, and I would such as a short answer. Mr.Massad as well as

Mr. Barofsky, that appears to simply toss up his hands frequently. Yes, Mr. Massad.
[Mr. Massad] Thanks, Congresswoman. No, I don’t assume we should simply go chilly turkey. That is why I would differ with some of the remarks that have actually been made that because.
HAMP has actually not attained three to four million alterations, that, consequently, we should.
finish it. I don’t think that makes feeling. I assume this program can still help a great deal.
of people. I believe it is constructed so that we just make use of taxpayer funds reasonably and also intelligently. To the extent that we do aid people, I believe it is assisting the appropriate people, people that.
need– [Ms. Norton] Allow me go to Mr. Barofsky, after that.
I assume it is extremely important.TARP was designed in part just as much to. That was component of the intent of. As well as I think Treasury births an essential obligation to fulfill that.
Ms. Norton] You don’t think we should. go chilly turkey and simply leave numerous consumers available–. [Mr. Barofsky] I want to see the program–. [Ms. Norton]
— to allow the market do what the marketplace always does.It does resolve all. such dilemmas one means or the various other.

[ I would such as to see a qualified. Ms. Norton]
Okay, let’s speak about that, because I am basically remedy-oriented as well as,. as I have actually seen in my very own area exactly how HAMP has actually failed many property owners, individuals that. work hard for their houses, obtained captured up in a situation not of their making, it does seem. that the only way out of this is to take measures that protect both property owners as well as investors. A recent Washington Message post, January 18th, in fact, recommended that. the incentive structure for services is significantly misaligned.Let me just price estimate that:
“Studies. have actually shown that repossession is typically extra lucrative

for a company, called a home mortgage.
servicer, that gathers the regular monthly repayments on home mortgages and passes them on financiers.
that possess the home mortgages. It is frequently not the finest path for borrowers that shed their.
residence or capitalists that shed cash.” Mr. Massad, is it real that home mortgage servicers.
commonly have a financial reward to foreclose on distressed customers and also sometimes the program,.
Well, what we are attempting to do. You know, prior to this program was started, we had 2 years of this situation and also.
No, no, let me make sure I am clear. I concur with what the FHFA is doing,. They are looking at the basic company model of the.
HAMP was likewise attempting to transform those incentives with regard to the financings we could affect,. Do you think the FHFA steps. What they are doing is saying, look, we need to re-examine exactly how servicers are made up,.
these concerns. [Ms. Norton]
Mr. Barofsky, Mr. Massad, thank you both for your wonderful work and also thank you for your service.
And Mr. Paulson claimed, no, we are not going to do that. I assume, Mr. Barofsky,.
Mr. Barofsky and also Mr. Massad, thank you for.
Allow me go to Mr. Barofsky, then.Massad, if this is not a.
win-win, it is not mosting likely to work.If it is a

win-lose– and it shows up commonly to be simply.
that– then we are going to be stuck, as well as that is where the consumers and the homeowners.
Well, that is right, Congresswoman,.
which is why I have claimed I believe there needs to be a great deal of focus paid to exactly how.
this industry has actually failed us in a great deal of means. We have actually seen a great deal of troubles appearing.
of this crisis and– [Ms. Norton] And also how your incentive framework.
has failed us. [Mr. Massad] . [Chairman Issa] The gentlelady’s time has actually expired. The Chair currently identifies the gent from Michigan, Mr. Walberg, for five minutes.
Thank you, Mr. Chairman. Would certainly the gent put on hold? The Chair would certainly keep in mind that we are expecting 2 votes at roughly 11:10.
help concerning another inquiry after the vote is called. We will certainly leave.We will certainly return

,.
and as soon as there are 2 individuals on the dais we will begin questioning once again so as.
to be considerate of your time. The gent might continue.
Thank you, Mr. Chairman. As well as thank you, Mr. Barofsky and Mr. Massad,.
for being here to appear in front of us. I had the suspicious distinction to elect on tarpaulin,.
to vote against it, I believe for all the best factors; I had the suspicious distinction to.
be seized upon by my electorate in the following political election; and afterwards for the last two years.
to hear the response of people who ultimately stired up to the fact that, yes, there was.
a trouble, yes, there was a considerable concern, yes, there was a meltdown that was taking.
place.But, frankly, their opinion was that it was the incorrect technique to take, as well as it.
appears to have substantiated. Mr. Massad, I would ask you, and I wish this.
hasn’t been asked while I was away at another committee meeting, however what are the strategies.
for the required TARP funds which have not yet been invested?
The only funds that have actually not yet been spent are those for the housing programs. As well as allow me just note it is not $70 billion for HAMP.
a GSE part– our portion of HAMP is 29. We have actually acted of other real estate programs. So there is $45 billion allocated for a variety of real estate programs.There is still a

really. percentage that is committed for the public-private financial investment partnership. Essentially, we are no much longer making new dedications. We are no more doing brand-new programs. Our emphasis. now is obtaining the cash back.
And also we have actually gotten, as I claim, a whole lot of it back, and also I. expect we will certainly obtain a whole lot even more of
it back. And essentially all the programs, leaving. Mr. Walberg]
Allow me make clear there are funds that are obligated that might be invested. I can’t make new dedications of funds. I. will not, as a result, make brand-new dedications of funds.
Mr. Walberg] Thank you.

Mr. Barofsky, on web page 6 of SIGTARP’s report, in referencing in comparing receivers of. the Federal help to Fannie and also Freddie, you make this statement: “In many ways, TARPAULIN. has actually assisted to mix the same toxic alcoholic drink of implicit
warranties and altered incentives. that brought about dreadful effects for the Government.
“. [Mr. Barofsky] Well, 2 of the huge qualities of what took place with the lead up to the conservatorship. of Fannie and Freddie was, one, the implicit guaranty
they obtained that they had a government. backstop, as well as among the heritage results of TARP is that the market still believes that. the USA Federal government is backstopping the largest also big to fall short institutions;. which causes an entire range of troubles. It injures market self-control.
Counterparties,. financial institutions, financiers, they don’t do the due diligence that is required when
examining. whether to do business with one of these financial institutions or spending among these banks since they. believe that any kind of kind of danger they take will be backstopped by Uncle Sam and the taxpayer. That provides a benefit; it provides the possibility to obtain cash much more cheaply. S&P recently introduced that their intent to change the rating system to make it a long-term. element that the huge as well big to stop working banks will certainly have higher rankings based upon implied. government guaranty, as well as they say this regardless of Dodd-Frank and also other nations’ feedback. to the financial crisis.This is a market distortion and, therefore,. the execs of those financial institutions return right into the placement where it is heads, I win; tails,.
What recommendations could you.
I believe that we are where we.
are, and also what we have is Dodd-Frank, and also the FSOC, and the committee that is giving. oversight, as well as it does have a great deal of tools. They require to have both the governing will. and the political will to rein in
the dimension of these banks. They need to do 2 things. which are going to be extremely tough, and Secretary Geithner, to his credit scores, was. remarkably honest with us regarding
the restrictions of what they are going to have the ability to do. But, firstly, they
need to have a system where they can credibly deal with large financial. establishments without releasing the investors, the lenders, the executives.Second, which. is possibly equally as vital, they need to encourage the markets that that is really. mosting likely to take place. Since if they do not persuade the marketplaces, if they do not have the trustworthiness. that they will certainly not be bailing out institutions going right into the future, it almost won’t matter.
otherwise because, once again, those incentives will certainly still be deformed; that discipline will.
still be gone; and those risks, with the idea that the taxpayer will certainly release
the executives,. the shareholders, the counterparties will certainly proceed a perversion of the system. [Mr. Walberg] Thank you. In the moms and dad globe we call that challenging love.
Thank you. [Chairman Issa] I say thanks to the gentleman.
The Chair asks consentaneous consent that a statement. for the record sent by the American Bankers Organization be placed at this time. Without. argument. [Chairman Issa]
The Chair currently acknowledges the. Thank you, Mr. Chairman, and also thank you for holding this
meetingConference Mr. Barofsky, I comprehend that you have the oversight authority to investigate home mortgage.
According to an NBC News record of January 17, JPMorgan. Chase & Business confessed that they overcharged thousands of active duty army families. Civil Relief Act particularly to shield armed forces households from high interest rates and foreclosure.
Mr. Massad, have you seen this record? [Mr. Massad] I have, sir. [
What can these households do various other than look for remedy from the firm? Congressman, I will certainly be happy to look into that; that is really outdoors.
It was a really uncomfortable record, I concur, as well as I would be satisfied to get.
Mr. Clay] Well, and also I am delighted to find out that JPMorgan has acknowledged its mistakes and is.
This tale makes me worry for a different factor. Currently, I presume banks do not have one collection company just for military servicemembers as well as. Mr. Barofsky]
We have. You recognize, we run the SIGTARP hotline, where we have collected. greater than 24,000 get in touches with since our inception, as well as a great deal of them are complaints from home owners. dealing with
mortgage servicers, definitely. And when we see those, we try to route them. to the right location.
If there is a claims of criminal task and it associates to the. HAMP program, we will take it; if it is criminal task that is outside of our police. territory, we will refer
it out; we will certainly refer it to Treasury if it is proper,. , if there is something that they can do; and
we also additionally them for our review evaluation as well as.. audit feature. [Mr. Clay]
Exactly how about the actual violent servicers,. can they be removed from the program? [Mr. Massad] I’m sorry, can they be gotten rid of. from– [Mr Clay]
Yes, can they be gotten rid of–. [Mr. Massad] From our program, from the HAMP program? [Mr. Clay] Yes. [Mr. Massad]
Allow me simply state we will continue to be hostile in this. We are in the large servicer stores. Mr. Clay]
Well, but if they are totally disregarding. the house owner and overlooking the documents, then–.
Sure. If I may, Congressman, I would not state they are completely overlooking.
we have obtained them to take note. We have actually come a long means.
When we started this, they. stated we can not do this, we are not prepared; and we said you have to prepare yourself. And also while we haven’t achieved as many modifications as we would certainly like, I will certainly confess that, I have.
constantly admitted that, yet, nevertheless, we are making some development. We are still getting.
That is important. It is not enough, however it. Can either one of the witnesses.
supply us with the malfunction of State by State of modifications? Would that be feasible? [Mr. Massad] Yes. We can definitely do that. We can do that for our program
, Congressman. We do produce a great deal of data as well as metrics on our program, however that only covers our program. There, frankly, aren’t a great deal of data on the rest of the industry in that
regard. [Mr.Clay] Okay. And also of unique rate of interest to me, obviously, would certainly get on Missouri. [Mr. Massad] Certainly. [Mr. Clay] Okay. I give thanks to the witnesses and. I generate back, Mr. Chairman. [Chairman Issa] I say thanks to the gentleman. Our last, for this round, before we most likely to ballots, will be the gent from Arizona,. Mr. Gosar. [Mr. Gosar] Thank you. Being from Arizona and also listening to the discussion in regards to Florida and also Ohio, I have to. say that Arizona, which we assumed was a leveling of our problems with housing, is now every one of. a sudden revealing some indications of double-dipping, so this is really troubling. And being from. an extremely bad area from the area, we see house owners on the very brink of catastrophe. My concern to you initially, Mr. Massad, is doesn’t the reduced price of loaning that results from.
the implied government warranty partially describe the banks ‘capabilities to pay back.
I think a more crucial element was the process that we carried out of the tension. A follow-up question, so the success depends upon that implicit guaranty. Mr. Massad]
No, I do not assume I said that. What I am stating is that we left the. banks’ investments, we got the cash back via this cardiovascular test and recapitalization. process.
I believe Mr. Barofsky is raising his sights on that that, in impact, it appears like what he is stating. Mr. Barofsky, just how would you
feel. Mr. Barofsky]
I do not assume that Mr. Massad. has properly identified my setting, to place it mildly. The solution to your question,. Is indeed, the implicit warranty definitely enabled those banks to get out of Tarpaulin on.
the terms that they did.

Because those financial institutions take pleasure in improved credit rating scores from the credit rating.
rating agencies, one of the conditions that the Federal Reserve as well as Treasury put for those. banks to leave tarpaulin was to go
out on the marketplaces and also increase resources, as well as the larger. banks can increase resources extra efficiently and cheaply due to this implicit guaranty,. as a result of the benefits they have. So, simply put, the solution to your inquiry is yes. [Mr. Gosar] Thank you. Mr. DesJarlais]
Thank you, Mr. Gosar. As well as I am instructed that we are concerning to be called to some votes, so I am very, really grateful,. The Chair now.
[Mr. Meehan] Thank you, Mr. Chairman, and thanks to the witnesses for continuing. to be with us here today. Mr. Massad, I checked out something which is. a bit various than what has been discussed up until now today, but I discovered in. my review of one of the most recent record the issue of the extent where recapitalization isn’t. just for the huge financial institutions, however a lot of times you are looking at groups of other financial institutions and. neighborhoods all throughout the Nation of different size, and a few of them are taking a look at difficult. issues too and also pertaining to you for recapitalization.So they are making
application to you for. recapitalization. What is your plan with regard to when you obtain that notice,. sharing it with others? [Mr. Massad] Congressman, thank you for the. question; you elevate a crucial issue. Of all, we do not ever
provide giveExtra funds. I intend to make that extremely clear. Secondly, our task currently relative to those financial institution financial investments. is to get as much of the cash back as we can.We still have financial investments in regarding 560. financial institutions, and there are a few of those circumstances where financial institutions have actually had problem as well as have come. to us since they are trying to attract exclusive capital, as well as they ask us to change our financial investment;. and also we have concurred in a little handful
of situations. The most significant is undoubtedly Citigroup, where. we accepted transform from favored stock to common stock. That one clearly turned. out effectively because we will understand a$ 12 billion revenue on our total investment.

A lot of the others have actually been extremely, really tiny.
We do attempt to function with the banks. The inquiry is constantly.
can we concur to some terms that assist them attract brand-new funding as well as, as a result, realize.
as high as we can. [Mr. Meehan] As well as there is one of the issues,. though, that struck my passion, due to the fact that component of your participation with them is producing.
an understanding on others, in numerous methods, to some extent, perhaps an indicator of good
authorization that. is tempting various other exclusive financiers to make capital investments to aid with that bank. Now, among the important things that concerned me in the record was the pointer that simultaneously. a few of these banks might be having problem for a variety of factors, including the potential. that they might be being took a look at for deceitful activities.So to what level as well as what timing.
has been your policy to report that to the IG who may, as you saw, 24,000 reports from.
individuals– as a district attorney, I used to see the whistleblowers being some of the essential points.
They have info. What are you doing to make certain that there are not tasks.
for prospective deceitful task? [Mr. Massad] It is an excellent question.We,.
Of all, cooperate completely with SIGTARP in terms of when they tell us they are investigating. I understand that in the SIGTARP’s quarterly record Mr. Barofsky has increased the inquiry of whether.
We have, every so often, done that and also that is a recommendation. that we are looking at– [Mr. Meehan] Are you asking that SIGTARP state. to you when they start to have someone under investigation? [Mr. Massad] No, I am not asking that. [Mr. Meehan] That is what I am attempting to comprehend. As well as I am not being aggressive on this, I am just trying to understand the timing right here, since. the issue I have is that they may be resting on details, investigatory details,. and also merely the truth that that would be leaked would be
as opposed to your interests. [Mr.Massad] Definitely. There– [
I recognize my time is going to run. Congressman, if I may, it is a really sensitive question, a great deal of intricacies.
Department is examining a financial institution; should that understanding be understanding that we have? We are speaking with Mr. Barofsky’s team, as well as the DOJ,. Mr. Barofsky]
I don’t think there is a. good deal of intricacy with this problem relative to SIGTARP.
They made use of to give us a head’s up before they would certainly. And we have actually currently made a formal referral that that process be implemented as well as. One of our most significant successes was with Colonial Financial institution, which had obtained conditional authorization.
Mr. Chairman, one final–. Chairman Issa]
Ask unanimous permission for another question. [Mr. Meehan] If there was a policy wherein, in the past, they were and also they are not now,. what is different; why has that altered midstream? [

And thank you, Mr. Barofsky and Mr. Massad,.
Mr. Massad, have you seen this record? Mr. Massad] My question to you initially, Mr. Massad, is does not the reduced cost of borrowing that results from.
Mr. Massad]Massad] Congressman, there had not been a.
formal policy; we had really few of these prior to, we did notify SIGTARP, and also we are looking.
at what needs to the official plan be, due to the fact that we additionally need to be delicate to the fact that.
if a police official shares info with us, we have to protect the discretion.
of that information; what setting does that place us in. As I claim, I believe there are.
some complexities to this. I would certainly more than happy to consult with you and your team to discuss.
it additionally. We are providing it really severe focus.
Thank you, Mr. Massad. I thank the gent. We now acknowledge the gentleman from Virginia, Mr.Connolly, for five mins.
Mr. Connolly] Thanks, Mr. Chairman. Speak about good timing.
[Chairman Issa] The very best. [Mr. Connolly] Thanks, gentlemen, for showing up.
before the Committee today. Mr. Massad, did the Bush Management make a mistake in.
producing the TARP program? [Mr. Massad] No, I don’t assume so, Congressman. Once again, I assume it was unfortunate that we had to develop tarpaulin. It was unfavorable that.
we didn’t have the devices to or else deal with this situation. I think they were.
to take the activities that they took.I am pleased of those participants of Congress from both sides.
of the aisle that stood as well as supported it; I think we needed this. And also, once again, it is.
unfortunate that we had to do it, yet I don’t assume we had much option.
[Mr. Connolly] At the time, Mr. Massad, that tarpaulin was created by the Shrub Assistant of.
the Treasury, Mr. Paulson, existed not calls then and also consequently for the nationalization.
Yes, there were, Congressman.
[Mr. Connolly] And also did tarpaulin supply a market-driven personal market choice to those telephone calls?
[Mr. Massad] Yes, I think it did. [Mr. Connolly] In spite of heated unsupported claims.
I concur, Congressman, yes.
[Mr. Connolly] And also, again, there were whole lots of issues– and also possibly, Mr. Barofsky, you.
want to comment, really feel free to– that TARP was mosting likely to be this limitless sucking sound.
that was going to, naturally, draw up tax obligation bucks as well as blow up the Federal shortage immensely. Is that what took place in the tarpaulin program? [Mr. Barofsky] I would certainly enjoy to address.
that. No, I believe that one of the areas where tarpaulin has do well has remained in the declining.
quotes of the financial prices of the program, absolutely.
[Mr. Connolly] And what is the internet expense currently of the $700 billion that was initially alloted.
It depends on that you ask. CBO did an estimate.We have all 3 quotes in the most current quarterly report. CBO’s.
OMB has a much considerably higher quote. That that number will certainly come down.
Twenty-five billion dollars. As well as I think the reason for the large difference. Mr. Connolly]
I am presuming that when CBO does its quote, it considers those factors. I imply, of course, whatever.
[Mr. Barofsky] Oh, of program.
The markets can enhance, which would be losses would. You discussed the HAMP program. I appear to recall this Committee.
since it just helped 167,000 Americans.Do I currently understand that number is half a. million? [Mr. Barofsky] Yes.

I’m sorry, proceed. [
Mr. Massad] Yes, that is appropriate, Congressman. That is the direct permanent modifications,. and also, obviously– [Mr. Connolly] Okay, so this stopping working program,. Has taken care of to aid more Americans.
Sometimes I believe of it as the. Currently, at that hearing we had statement from financial institutions, as well as maybe, Mr. Massad,.
that time, which was 167, underrated the reach of the program favorably since a.
great deal of financial institutions remained in fact helping house owners since HAMP existed as well as had produced a standard.
they might adhere to. Would you comment? [Mr. Massad] That is absolutely right, Congressman. Before we began HAMP, the servicers actually weren’t doing modifications, they weren’t.
And also when HAMP came in, it supplied some requirements that the servicers have now replicated in their. I assume we are making this situation better, at least, for–. My time is up and also I give thanks to the Chair.
You are extremely welcome.The Chair now acknowledges the gentleman from Oklahoma,.

Mr. Lankford, for five minutes. [Thank you I have a few inquiries. And also thank you, gentlemen, for enabling us.
to be able to march as well as vote as well as be able to go back in as well on it. Mr. Massad, I know a few of the limitations that Dodd-Frank has actually placed on TARP as well as the.
limits of the new programs as well as such on it. Is Treasury going to have the ability to ensure.
us today that there is no strategy, no intention that any kind of tarpaulin funds will be utilized for State.
pension plan bailouts or for State government bailouts based upon the limitations of what can be utilized.
Yes, sir.
Terrific. Just wanted to be able to get clarification on that.
1 of your report, in paragraph 4 it information several of the numbers on it: the $410 billion.
paid out to date, we have actually received back 270, standing for $235 billion; $35 billion added.
earnings; about 166 billion remains outstanding.If I am running those numbers. correctly, we are missing concerning$ 9 billion because number on that, so I really did not recognize.
if you would agree to be able to resubmit to us just a created update on that, where.
that other $9 billion and exactly how that suits there on that.
I would be happy to do that, sir. I do not think it is $9 billion.
I would certainly be happy to do that. Those numbers, when.
we include them together, the quick detail out there; and I know that is simply a really quick.
information on it. The third thing gets on the vehicle industry financing.
program, what is the plan at this factor? You provided us a great declaration on that particular. What is.
the strategy for exiting out? We have actually gone from 61 percent possession in stock to now 33 percent. That is great, that is making great development, as well as thank you for that.What is the

strategy to.
take us to no percent? [Mr. Massad] We are actively dealing with that. I intend to be mindful. As a result of the safeties legislations, we can’t be as well definitive about a.
schedule, today that we have actually finished the going public of GM, we do have.
a pathway to offer the rest of our shares, and I would certainly anticipate that we would sell all.
those, ideally, within the next two years, market conditions permitting. With respect.
to our various other investments in Chrysler and also Ally Financial, we are additionally pursuing first.
Has Treasury set up a schedule.
on what they are trying to find to claim, by this day certain we are mosting likely to be out, no matter,.
or is this– this is mosting likely to appear pejorative– playing the market with it to try to function.
it out? Yet is there some strategy to say by this date certain we are going to be out?
[Mr. Massad] No, we have not done that due to the fact that I believe we do have to be delicate to a pair.
of things. One is market problems. In the case of the firms that aren’t.
Public, they actually have to be ready to go public, we can not force them actually to.
do that. Yet I can ensure you that we are trying to leave all of these financial investments.
as quickly as possible. I strongly believe that our purpose, which is to promote financial.
security, is finest offered today by getting the Government out of the organization of owning.
rate of interest in private firms. [Mr. Lankford] I would most definitely acknowledge on.
That one. With that in mind, is Treasury still daily in the operational business.
of GM, Chrysler and Ally? Exists still a person that is onboard there with their shareholders.
as well as such that is helping advise? [Mr.Massad] We check those financial investments,. We have actually never taken part in the daily monitoring, and also we have made it really clear. that we will refrain from doing so as well as we do not believe that is an ideal role for the U.S. Government.
I would agree on that one. Mr. Barofsky’s report.
information $59.7 billion that is readily available, that is sitting out there, and I make sure that cash.
may move some based upon day-to-day procedures on it. When, in your point of view, does tarpaulin sunset? When do we not have hearings on TARP because TARP doesn’t exist anymore, all readily available.
funds have currently been returned and there is no more TARP? What is the prepare for that?
[Mr.Massad] I would certainly state on the financial investment side, again, we are attempting to go out as quickly. as feasible. I, once again, can not give you a schedule, but I think, with regard to the.
remaining investments, which allowed’s call approximately $170 billion, I think we will obtain.
a lot of that back in the next two years. There will certainly be some section that we can’t return.
within that time framework, but we will certainly, and also we are, winding down the procedure and.
trying to venture out as fast as we can. With regard–.
[Mr. Lankford] Would it aid in all to have a legislative remedy on this, to establish a timetable.
to state the American people require some guarantees that, twenty years from currently, we are still not.
TARPing, that we are available as well as that we have a time certain?
I do not assume a legal option would certainly be helpful since that could. Believe me,. I don’t plan to be right here 20 years from currently.
Mr. Lankford] Great. Let me give you one last quick concern on it. In Mr. Barofsky’s report, as well, it information out that the 5 largest banks now manage around.
60 percent of gross residential product; they are all 20 percent bigger than what they were.
I understand you were speaking about how the tiny as well as medium sized banks are helping as well,. The end result has been the largest financial institutions have actually
grown biggerLarger and they seem appear be evenAlso Mr. Massad]
There has been boosted concentration. in our economic system as an outcome of this crisis
. I think possibly without TARP that. would have been also greater, because we wouldn’t have actually aided a whole lot of institutions that have. had the ability to weather the storm.But the question as to whether it is as well concentrated is certainly.

one that this Congress can use up. And as Mr. Barofsky has actually appropriately kept in mind, that. is a concern that the Congress may desire to consider.
I believe what we have right currently under. Dodd-Frank are devices to try to manage that. As the remark was made, some people have. suggested nationalizing banks; some people have recommended breaking them up.
That is clearly. plan choices that the Congress can take into consideration. [Mr. Lankford] It simply appears to me that we. prefer the largest of banks in this structure. As well as I understand that my.
Thank you extremely much. Mr. Massad]
Thank you. [Chairman Issa] I say thanks to the gentleman. The Chair now recognizes the gentleman from. Illinois, Mr. Walsh, for 5 mins.
Thank you, Mr. Chairman. Thank you both for coming in; it has actually been a long early morning. What is your biggest problem that you have right currently for area.
A great deal of the tiny lenders do have car loan portfolios that are much more heavily weighted to the actual. estate field as well as, therefore, they have actually been injured by that.Number two, they don’t have.
accessibility to capital as quickly as the huge banks, so those are extremely genuine concerns. And also we have.
attempted, with the TARP program, to resolve a few of that. You know, basically, when you look.
at the cash bought banks, about$ 250 billion overall under tarpaulin was spent.
The majority of. of that, 234 or two, around that amount, was done under the Bush Management.
I concur with the activities that they took, however I am just aiming out that they did that. A hundred twenty-five billion of it went to the largest institutions in the Country.When. Obama came in, we have actually only spent an extra $11 billion in banks, and a great deal of that went.

to a great deal of the smaller sized organizations and we established unique programs to help them. . most of them are still struggling as well as we are trying to do our finest to obtain this economic climate. back and also obtain a financial recovery, get the housing market maintained, since I think. those are the very best things we can do for those banks. [Mr. Walsh] And, Mr. Barofsky, why still this continuing fight with the community banks? [
Mr. Barofsky] Part of it is, as Mr. Massad pointed out, the framework of their profile,. however a large component of it is also the continuing existence of as well huge to fail; it offers an. intrinsic advantage to the larger banks. There is a reason why the smaller financial institutions don’t
. have the very same access to capital as the bigger banks; they do not have the access to the.
basically free cash from the Federal Get that the bigger financial institutions.
A whole lot of what has actually been.
[Mr.Walsh] Perhaps this leads, then, to my 2nd short macro degree concern. Each. of you provide one broad degree review of TARP, either with its implication, with
its layout. If you were per deal one wide review of TARP, what would it be? [Mr. Massad] You recognize, if we had to do this all over again, and also obviously
I am assuming. we will certainly not need to, there are a whole lot of points we might change or would transform, Congressman. It is difficult to be particular. There are certain things in the real estate program that we have. done later that we could have done previously. I concur with the remark that was made earlier. that it was suggested as an acquisition of distressed possessions and after that I assume the Bush Management. intelligently altered training course due to the fact that I believe they needed to, however that undoubtedly contributed to.
several of the criticism.So it is things like that. There are lots of. others I am sure that we would correct, however I believe the crucial thing is

with any luck currently, under. Dodd-Frank, we have the tools that will make this type of point unnecessary in the future. [
Mr. Walsh] One general critique, Mr. Barofsky. [Mr. Barofsky]
I assume one of the things that. Tarpaulin was, was much better transparency
for the Treasury Department. From day one this has.
people, being even more up-front and also straightforward about these programs, whether it was claiming that.
the very first nine organizations were all practical and healthy, when they recognized
complete well that. a few of them were not; to some of the more recent statements, the cheerleading statements. concerning the program, which under a little further evaluation specific points were left.
I assume that having a much more clear program.– will certainly help resolve some of the actual adverse views of this program, due to the fact that I assume if.
individuals comprehend it and also really feel that everyone is being up front with them, it can be a much more.
notified conversation, be an extra informed argument. Right now, Treasury’s running of
. this program has actually been viewed of one, I have heard, of selecting champions
and also losers, or backroom. offers, and those objections really come out of these openness failures. [Mr.Massad] , if I may respond to that.
.
I am fully dedicated to transparency, and also the majority of. of the certain ideas that
SIGTARP has made in this respect we have executed. I would much like to note, because I believe commonly individuals aren’t aware of it. We release. annual monetary statements which are investigated, and we have actually received tidy point of views on these. financial declarations for two years, without any kind of product weak points.
That is in fact. an extremely unusual point for a start-up entity; it is a relatively unusual point
in federal government. We publish a month-to-month report to Congress that outlines precisely where the cash is, just how much. of it has actually come back, what is the standing of the program. We publish a purchase record. on each purchase within 2 organization days of completing it. We release a reward and
. interest report quarterly which shows how much returns as well as rate of interest settlements we have.
gotten.We placed all of our agreements and also contracts on our internet site. That implies not only any contract participated in with
an economic establishment, yet likewise all. the procurement agreements, all the documents connected to HAMP, as well as any program we have,. As program standards and also various other products. We have indicated prior to Congress countless. times; we satisfy. We have three oversight agencies and also we completely accept them and also give. them all the info that they require. They have generated an overall of 75 reports. We can always aim to do more, but I think, actually, there is a great deal of details. regarding this program readily available. [Mr. Walsh] Thanks both.
Thank you, Mr. Chairman. If anyone else arrives that has not had an initial round, we will certainly take them if they show up in the past.
we end up. Otherwise, with your indulgence, we want to have a quick 2nd round. for a pair people.At this time, I would certainly most likely to the Chairman of. the Subcommittee of territory, Mr. McHenry, for his concerns. [
Thank you, Mr. Chairman. Mr. Massad, S&P takes into consideration the probability of federal government’s assistance clearly in their. Do you think that is a straight outcome of Tarpaulin?
We haven’t applied Dodd-Frank yet, but those are the devices we.
now have. I do not assume it is ideal to criticize it on TARP however, instead, criticize it. on the fact that we didn’t
have a sufficient regulatory system, and that is what we are.
trying to boost now. [Mr. McHenry] I want to call the.
Geithner slide, if I could. Secretary Geithner, Mr.Barofsky, as well as your record on Citi, details.
very plainly in the future we may need to do extraordinary points once more if we deal with a shock.
that huge. We simply don’t recognize what is systemic and also what is not up until you understand the nature.
of the shock. Currently, Mr. Barofsky, was this interview post-signing. of the Dodd-Frank
law? [Mr. Barofsky] This meeting took place in. December of 2010.
Mr. Massad, it seems that your. Just how do you fix up that? No, I do not believe it is.
To, and also neither I nor Mr. Barofsky were actually in the area–. Mr. McHenry]
We have his words. [Mr. Massad] Yes, we do, and I have actually likewise talked. Mr. McHenry]
. [Mr. Massad] The devices under Dodd-Frank.
are flexible.

Thank you, Mr. Massad. Thank you, Mr. Chairman. Mr. Massad, S&P considers the chance of federal government’s assistance explicitly in their. Mr. Massad, it seems that your. Mr. McHenry]We are not going to have just a set of unalterable, quantitative standards
that state if you are above this quantity of properties, you are too large to fall short.
[Mr. McHenry] Okay. [Mr. Massad] We have qualitative and also measurable
— [Mr. McHenry] My next slide is President Obama
claimed last night in the State of the Union due to this law, there will certainly be new guidelines
to explain that no company is in some way protected once more– I am sorry, the Dodd-Frank finalizing
in July of last year. He claimed these new guidelines will certainly make clear that no company is somehow secured
because it is as well large to fail so we do not have another AIG. Mr.Barofsky, it

appears that Assistant Geithner’s words run counter to that. And also it is hard
to, after the truth, for his team to claim he didn’t truly mean it. Can you provide us context
Certain. And a pair things I.
want desire make very extremely. I was not in the area; I had six members of SIGTARP, consisting of.
my deputy, were in the space. And also after we got this quote, we recorded it and,.
as is the normal technique of our records, we supplied the quotes in a draft duplicate of.
the report to Treasury, both the quote itself as well as the context in which it was presented,.
and also we had a number of conversations. They made some tips; we integrated those.
suggestions. And also at the end of that process Treasury guaranteed us that they did not contest.
the language that was made use of, the quote itself, and did not think that we had presented it.
in any kind of deceptive or wrong context.So the quote

is the quote. We stand by it. There is no question in my mind, as well as based upon our interactions with Treasury prior to the.
record was launched, that it is an accurate quote. I believe that Secretary Geithner, and.
it was the impression of the 6 individuals in the space, was being transparent, was being.
honest, and I commend him for that, by recognizing the fact that the marketplace is today that.
financial institutions are still too huge to stop working. Currently, the hope is that if Dodd-Frank– as well as.
absolutely Dodd-Frank has actually given the regulators many, lots of possible tools, and also if those devices.
are executed appropriately– as well as that is a very, very large if– it would certainly need actions.
by the regulatory authorities that, honestly, they did not seem efficient in performing in the runup to.
this crisis, as far as seeing around edges and understanding. Yet allow’s presume that.
they can. With any luck we can obtain to a point or a day where the market will believe that.
the government does not need as well as will not bail out these companies.But we are not there.

[ Mr. McHenry] So we understand that S&P has actually made the idea of a bailout, a TARP-like program.
or Dodd-Frank– it is hard to actually judge based on S&P making permanent their evaluation.
of truly a Federal backstop to bail out the largest companies. We likewise recognize that there is.
explicit guaranties, authorized via contracts in 2008 as well as 2009, for these economic institutions,.
whether it is the Fed, FDIC, or tarpaulin, of a backstop to– well, federal government warranties.
of properties. We recognize the explicit number? [Mr. Massad] Yes.
[Mr. McHenry] The question to both of you is can you inform this Committee what you believe.
the net present worth of implicit federal government guaranties are going ahead to these monetary.
organizations? [Mr. Barofsky] There have actually been some research studies,.
and I think we consist of one as an explanation recommendation in our report. We do not do that sort of.
economic evaluation, yet I think I saw one that recommended that it was– and also please do not.
estimate me on this– I assume a $34 billion a year advantage that the larger organizations.
have due to their capacity to elevate financial obligation extra cheaply than their smaller sized rivals.That.

is one number, I believe, from one scholastic research study that may be practical.
Mr. Massad? Congressman, I don’t.
have an ability to measure that right away, however let me simply attempt to reply to your concern. In terms of specific warranties, I think you are describing the Citigroup asset warranty.
program, which has actually currently been ended at a revenue to the U.S. Federal government, so there.
is no longer– [Mr. McHenry] No, actually, that is not what.
I am referring to. There are actually– at the time of the financial crisis, as has been.
well documented, FDIC, the Fed, TARP, Treasury has explicit guaranties via contracts.
that are openly readily available. I am asking you about the implied– as well as those are well know,.
well documented; we don’t have to rework them right here. I am asking about the implied.
guaranties. And Also Mr. Barofsky, as he points out in his record, has–.
If the gentleman can end. Actually I assume the thrust.
of your problem is have we dealt with the too big to fall short concern adequately, as well as I guess.
my reaction to that is that Congress passed the Dodd-Frank legislation to deal with that.If there

.
is a view of some that that wasn’t enough, that is a judgment for Congress to make. .
I assume where we are currently, where Treasury is is that we are proactively attempting to implement.
that regulation so that we can utilize the tools it gave us to make certain that no establishment is too.
large to fail. As well as I think it is early to end that it hasn’t worked and that.
we need some tougher regulations to resolve that.
I give thanks to the gentleman. The Chair now identifies the Ranking Member.
[Mr. Cummings] Mr. Massad, the Dodd-Frank regulation consists of a variety of provisions.
meant to get rid of the idea of too large to fall short. The legislation is clear.
that taxpayers will not cover the price of conserving stopping working institutions and will certainly not cover.
Book’s 13 (3) emergency situation lending
authority to prohibit ban out an individual private. The regulation develops a Financial Security Oversight Council to keep track of systemic. Can you describe briefly exactly how application of these steps will resolve the too huge.
Treasury to brief you. Yet my understanding where we are is the legislation was come on July.
There are a variety of rulemaking treatments as well as studies that are being conducted.The. FSOC holds normal meetings as well as it always has a component of that which is public, and also they. are busy functioning on these.
They are also hectic creating the Office of Financial Research Study,. which is developed to keep track of
conditions in the financial industry as well as help us determine. what dangers need to be dealt with.
I would certainly be happy to obtain you–. [Mr. Cummings] Please do.
[Mr. Massad]– an extra thorough instruction. [Mr. Cummings] And we will comply with up with you with some comprehensive concerns
, all? As well as if you can answer this: Just how will criteria be developed to enable us to determine companies. that present systemic risks and are consequently systemically substantial? I take it that you. will do that in writing likewise?
I will claim really. Mr. Cummings]
Allow me claim this. I think that you all hear, both sides
of the.
Okay, I simply want to
make sureCertain I indicate, obviously, declarations have been made concerning HAMP. I think the key point is the declaration.
there are these issues, we ought to just transform it all back over to the servicers and also.
allow them take care of it; and I assume that would absolutely be the wrong thing to do.
It has actually been clear, not simply from our HAMP experience, but from the.
it back over to the servicers would certainly not be positive currently. [Mr.Cummings] 2 points. You had talked a little previously regarding retooling. I take.
it that there are points that you are doing currently, you are in the process of doing
, attempting. to improve the program to make it a lot more reliable and also effective, is that right? [Mr. Massad]
That is right. We have done a number of points–. [Mr. Cummings]
And I desire you to offer us a checklist of those points as well as when do you expect. I am running out of time.
Mr. Massad] Well, it is a recurring process.As we see issues, we reply to them. Yet,.
We have attended to the reality that initially we started this program by trying to get a. whole lot of
people into trials tests as well as didn’t really did not the servicers verify the income.That. I do not desire to see the program finished, yet if you are informing us that you are doing points. I want you to tell us when you can come
back.
[Mr.Massad] Congressman. Pleased to do that. [
Chairman Issa] And also in response, if you will certainly commit to provide us regular monthly updates following
month. and the adhering to month, we will certainly devote to have you back in your next quarterly report,. , if that works for both of you.. [
That is great. Mr. Chairman, I really value that.
[Chairman Issa] Thanks. [Mr. Cummings]
And also I produce back. [Chairman Cummings] I say thanks to the gent. In closing, I have simply a couple of questions,.
We obtained right into HAMP. We did not get right into the$ 30 billion of required and just how that. If you would, and also I understand Mr. Barofsky has.
upgrade a great analysis so the participants can have your interpretation of outstanding funds,.
significance– and this is a concern for Treasury in consultation with the Fed– obligated. funds staying at the Fed, because we are not the Financial Solutions Committee, so you.
will certainly have to give us a little guide periodically; considering the funds dedicated. under other programs, consisting of HERA. Because I assume that will help us understand where.
is the money still remaining out that is either obliged or actually out, which
will. assist us 30, 60, as well as 90 days from now. It is extremely clear that we do still have major.
reliable firms that believe too huge to fail is leading them to having more success. in loaning cash at a reduced amount.That is a difficulty for tiny financial institutions, and we certainly. would love to work as a Committee to make certain that, as Dodd-Frank is placed into action, that. that leads to a fading away of that as the President had promised
at the time of its. signing.

We additionally really did not chat about, and also I would such as. this included in your record or briefing sheet, the around $145 billion that I
believe. is gone permanently to the GSEs, the actual failing rate, which often, as we are speaking about. the success of TARP, we are failing to remember about Freddie and also Fannie’s actual losses that. we have actually backstopped as a Country. One point that I would appreciate, which is. uniquely to Treasury, most of us right here in Washington that have actually stayed in business
have tried to convert. from GAAP over to understanding the Federal Government’s pay as you go audit. Now,. at Treasury you are a little various, you are a hybrid, and so as I
browsed a. report, which I think our people have actually provided you with, a record inner that we
established,.– if not, we will– I began seeing the amassing system of gets enter into play in a way. that, as a public company police officer, I constantly question.Okay, you had a mentioned worth, a.
marked to market price, you returned and mentioned them, reiterated them in this year for.

In this year they got so much far better.
However I assume it is necessary due to the fact that, as I recognize it, those numbers.
show really review the expected deficiency as well as various other figures that we take a look at,.
and I assume everyone desire to understand real deficiency in 2009, real deficit in 2010,. therefore on.Actually, we don’t
wish to know it, we would certainly like it not to exist, however we.
would a minimum of like to have the exact numbers for them. Finally, a request.
Today we have been talking in net bucks. Before we chat again, I would. like the Committee to have source product that preferably you 2 very much concur on. in the manner in which a regular service would do it, implying you stand for a make money from investments. you made, lendings you made, warrants, etcetera, that have been recognized. Those do not go as.
What we would, I believe, like to see is where you put the money in as well as what you lost; where. Properly what we are saying is scrape. Any kind of time a particular.
When we are evaluating what functioned as well as didn’t function in this program
that, since I assume. never did what we prepared for, yet did something extremely different, it is vital, I think,. for everyone to see, fine, finances to solvent entities in certain types worked; other things. not so much.And clearly some of these you can’t answer due to the fact that General Motors and. Chrysler are predicted but not yet final, however we will take the forecast. I would like to take the freedom, rapidly, in closing of reviewing what is a draft,.

yet our company believe will be the final objective declaration, since as a private market
person, I figure. at some time when you take over as CEO, the initial point you need to do is make sure your. objective statement to your individuals matches what you would like
to see. And also since this is. our very first hearing, I would certainly like to review it.
Americans should have to recognize that money Washington. draws from them is well invested.
Americans are worthy of a reliable, efficient federal government that functions. for them.
Our job on the Oversight as well as Government Reform Committee is to aid Americans secure.
these rights.Our task is to hold Federal government answerable to taxpayers because taxpayers. have a right to recognize what they obtain from federal government. We will work tirelessly in partnership with. citizens-watchdogs to provide
facts to the American people that bring reform to the Federal. bureaucracy. This is our objective statement.
With any luck we. started today by asking you, as you have done, to help us because effort. I thanks as well as.
Whereupon, at 12:16 p.m., the board was.
]

Mr. Massad? Mr. Massad, the Dodd-Frank regulation includes a number of provisions.
Mr. Cummings] Mr. Massad] Mr. Cummings]

As found on YouTube

PEOPLE – SERVICES – IMPACT