Financial Services Committee - 9-17-09, Bachus Introduces Bipartisan Legislation To Ensure Independent Management, Exit Strategy From TARP Investments

Republican Plan To End The Bailout Of Fannie Mae and Freddie Mac

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9-17-09, Bachus Introduces Bipartisan Legislation To Ensure Independent Management, Exit Strategy From TARP Investments

September 17, 2009

-Financial Services Committee Ranking Member Spencer Bachus introduced bipartisan legislation today that will protect the interest and investment of taxpayers by establishing an independent trust to manage the government's assets acquired under the Troubled Asset Relief Program (TARP). The legislation also brings an end to government ownership of large stakes in companies.

Ranking Member Bachus said, "We have a duty to ensure the government's investment in companies is temporary and the return for taxpayers is appropriate. Political interference should have no role in the government's management of these assets because it provides no benefit to the taxpayers. That is why it is important that independent and professional trustees manage these assets in the taxpayers' interest. The legislation also achieves a timely and responsible exit strategy from the unprecedented level of government involvement in these companies. We need to wind down TARP to prevent it from becoming a permanent program."

The TARP Recipient Ownership Trust Act, H.R. 3594, creates a trust for the management of the government's investments in companies where its ownership interest exceeds 15 percent. The trust will be managed by three independent trustees. The trustees are tasked with operating as fiduciaries for the taxpayers and charged with making all core governance decisions. The trustees are also required to divest the government's interest by December 24, 2011.

The legislation is cosponsored by House Republican Leader John Boehner (R-OH), and Reps. Paul Kanjorski (D-PA), Scott Garrett (R-NJ), Dennis Moore (D-KS), Mike Rogers (R-AL), Stephanie Herseth Sandlin (D-SD), Walter Jones (R-NC), Michele Bachmann (R-MN), Erik Paulsen (R-MN) and Chris Lee (R-NY). A similar bill was introduced in the Senate by Senators Bob Corker (R-TN) and Mark Warner (D-VA).

Click here to view the legislation.