Auto Task Force Moves Questioned by Oversight Panel
A Congressional Oversight Panel report on the use of Troubled Asset Relief Program (TARP) funds to restructure the auto industry questioned some of the decisions President Obama's Auto Task Force made with regard to General Motors and Chrysler.
The report did not say the Task Force broke any laws, but it suggested there were many unresolved issues regarding the handling of GM and Chrysler.
The Panel stated it is unlikely taxpayers will recover all of the money the federal government invested in GM and Chrysler. The report said "approximately $5.4 billion of the loans extended to the old Chrysler company are highly unlikely to be recovered."
With the U.S. government now owning 10 percent of the new Chrysler and 61 percent of the new GM, the Panel made several recommendations for how the Treasury Department should oversee its investment.
Among them, the Panel called for the Treasury Department to provide, "...a full, transparent picture of its actions."
It also suggested the federal government use its role as shareholder to ensure the compensation of GM and Chrysler executives is aligned to the long-term success of the auto makers.
On the issue of potential conflicts of interest, the COP urged the Treasury Department to "..consider placing its Chrysler and GM shares in an independent trust that would be insulated from political pressure and government interference."
Finally, the oversight panel said it believes the Treasury Department should provide the legal justifications for its use of TARP funds to restructure the auto industry.