The SIGTARP Police is Coming

CNBC has this article about SIGTARP, the inspector general agency of the infamous TARP program. As usual, it is an entirely duplicative agency, with its own law enforcement separate from the IRS or the SEC or the Justice Department.

Coincidentally, I received a call recently from someone within SIGTARP who was doing some investigative work on a bank that accepted TARP funds. I happened to buy shares in that bank and subsequently sold them. A couple of the caller's questions were rather pointed. For example, this person asked, "would you have purchased the stock if you knew it was a fraud?" to which I responded that of course I would not have. The person also asked whether I relied on their financial statements being truthful and honest, to which I answered yes.

I asked whether or not fraud had been determined and why the SEC or the DOJ wasn't working on it if that was the case. The person's response danced around the question, implying that they were still building their case. I was then asked if I would be willing to testify at a hearing, to which I responded that I basically broke even on my trade. No matter, I was informed and that they might call back again for my help if I was needed.

Do we really need another duplicative agency in Washington, especially one that seems to have already stacked the decks against the companies they are pursuing? Of course, I don't yet have all the details, but to me it seems that banks that fail or don't pay back the TARP funds might be criminally prosecuted under the auspices of "fraud." It will be interesting to see, but it would not surprise me.