Washington, D.C.--On the first anniversary of the collapse of Lehman Brothers, Congressman Eliot Engel said Democratic insistence that the TARP rescue legislation include language requiring taxpayers be repaid as the financial sector recovered from a threatened collapse. That language has enabled the repayment to begin. Taxpayers have already had $72.57 billion of the principal repaid, along with $9.15 billion in dividends and $2.9 billion from repurchased warrants.

The 11-term Congressman said he supports the reform principles outlined by President Barack Obama in his speech on Wall Street Monday:
• Protecting consumers and investors
• Closing loopholes in the regulatory system to provide for clear and consistent rules
• Protecting the system from excessive risk.

Rep. Engel said, “Banks and other financial institutions were loaned $218 billion by the government last fall to avert the very real possibility of another Great Depression. The government’s rescue of the financial industry is working, and taxpayers are seeing a return of their investment. This should be the start of the rapid withdrawal by the government from the financial industry, leaving a system able to stand on its feet with stronger regulatory oversight in place to avert a repeat of this near-disaster. I agree with Treasury Secretary Timothy Geithner who said, ‘because of comprehensive policy actions put in place…we are back from the edge of the abyss.”

In addition to the recent repayments, Bank of America is in talks with the Treasury Department to repay $20 billion of its original $45 million cash infusion. Wells Fargo recently announced its intention to pay back its entire $25 billion package. Information regarding the rescue funds sent to AIG and the auto industry has not been sufficiently analyzed to render judgment on their situation.

“The government was forced into action by the financial sector’s own mismanagement, and in many cases, blatant greed. Now that disaster has been averted and the money has begun funneling back into the Treasury, we can set our sights on keeping the financial industry not only solvent but honest, and allow it to thrive,” said Rep. Engel.

“Now we can begin breathing a bit easier, but we must not permit a return to the excesses of the past. The financial industry knows they were not given a blank check, and the delivery of financial salvation came with stringent requirements. We will be watching to make sure they have learned their lessons and are not going to allow for history to repeat itself,” added Rep. Engel.