Where'd The Bailout Cash Go? It's A Secret

After Getting Billions In Taxpayer Money, Banks Hush-Hush On Money's Fate

(CBS/AP)  Think you could borrow money from a bank without saying what you were going to do with it? Well, apparently when banks borrow from you they don't feel the same need to say how the money is spent.

After receiving billions in aid from U.S. taxpayers, the nation's largest banks say they can't track exactly how they're spending it. Some won't even talk about it.

"We're choosing not to disclose that," said Kevin Heine, spokesman for Bank of New York Mellon, which received about $3 billion.

Thomas Kelly, a spokesman for JPMorgan Chase, which received $25 billion in emergency bailout money, said that while some of the money was lent, some was not, and the bank has not given any accounting of exactly how the money is being used.

"We have not disclosed that to the public. We're declining to," Kelly said.

The Associated Press contacted 21 banks that received at least $1 billion in government money and asked four questions: How much has been spent? What was it spent on? How much is being held in savings, and what's the plan for the rest?

None of the banks provided specific answers.

"We're not providing dollar-in, dollar-out tracking," said Barry Koling, a spokesman for Atlanta, Ga.-based SunTrust Banks Inc., which got $3.5 billion in taxpayer dollars.

Some banks said they simply didn't know where the money was going.

"We manage our capital in its aggregate," said Regions Financial Corp. spokesman Tim Deighton, who said the Birmingham, Ala.-based company is not tracking how it is spending the $3.5 billion it received as part of the financial bailout.

The answers highlight the secrecy surrounding the Troubled Asset Relief Program, which earmarked $700 billion - about the size of the Netherlands' economy - to help rescue the financial industry. The Treasury Department has been using the money to buy stock in U.S. banks, hoping that the sudden inflow of cash will get banks to start lending money.

There has been no accounting of how banks spend that money. Lawmakers summoned bank executives to Capitol Hill last month and implored them to lend the money - not to hoard it or spend it on corporate bonuses, junkets or to buy other banks. But there is no process in place to make sure that's happening and there are no consequences for banks that don't comply.

Meanwhile, banks that are getting taxpayer bailouts awarded their top executives nearly $1.6 billion in salaries, bonuses, and other benefits last year, an Associated Press analysis revealed.

"It is entirely appropriate for the American people to know how their taxpayer dollars are being spent in private industry," said Elizabeth Warren, the top congressional watchdog overseeing the financial bailout.

But, at least for now, there's no way for taxpayers to find that out.

Pressured by the Bush administration to approve the money quickly, Congress attached nearly no strings to the $700 billion bailout in October. And the Treasury Department, which doles out the money, never asked banks how it would be spent.

"Those are legitimate questions that should have been asked on Day One," said Rep. Scott Garrett, R-N.J., a House Financial Services Committee member who opposed the bailout as it was rushed through Congress. "Where is the money going to go to? How is it going to be spent? When are we going to get a record on it?"

Nearly every bank AP questioned - including Citibank and Bank of America, two of the largest recipients of bailout money - responded with generic public relations statements explaining that the money was being used to strengthen balance sheets and continue making loans to ease the credit crisis.

A few banks described company-specific programs, such as JPMorgan Chase's plan to lend $5 billion to nonprofit and health care companies next year. Richard Becker, senior vice president of Wisconsin-based Marshall & Ilsley Corp., said the $1.75 billion in bailout money allowed the bank to temporarily stop foreclosing on homes.

But no bank provided even the most basic accounting for the federal money.

Some said the money couldn't be tracked. Bob Denham, a spokesman for North Carolina-based BB&T Corp., said the bailout money "doesn't have its own bucket." But he said taxpayer money wasn't used in the bank's recent purchase of a Florida insurance company. Asked how he could be sure, since the money wasn't being tracked, Denham said the bank would have made that deal regardless.

Others, such as Morgan Stanley spokeswoman Carissa Ramirez, offered to discuss the matter with reporters on condition of anonymity. When AP refused, Ramirez sent an e-mail saying: "We are going to decline to comment on your story."

Most banks wouldn't say why they were keeping the details secret.

"We're not sharing any other details. We're just not at this time," said Wendy Walker, a spokeswoman for Dallas-based Comerica Inc., which received $2.25 billion from the government.

One didn't even want to say they wouldn't say.

Heine, the New York Mellon Corp. spokesman who said he wouldn't share spending specifics, added: "I just would prefer if you wouldn't say that we're not going to discuss those details."

The banks which came closest to answering the questions were those, such as U.S. Bancorp and Huntington Bancshares Inc., that only recently received the money and have yet to spend it. But neither provided anything more than a generic summary of how the money would be spent.

Lawmakers say they want to tighten restrictions on the remaining, yet-to-be-released $350 billion block of bailout money before more cash is handed out. Treasury Secretary Henry Paulson said the department is trying to step up its monitoring of bank spending.

"What we've been doing here is moving, I think, with lightning speed to put necessary programs in place, to develop them, implement them, and then we need to monitor them while we're doing this," Paulson said at a recent forum in New York. "So we're building this organization as we're going."

Warren, the congressional watchdog appointed by Democrats, said her oversight panel will try to force the banks to say where they've spent the money.

"It would take a lot of nerve not to give answers," she said.

But Warren said she's surprised she even has to ask.

"If the appropriate restrictions were put on the money to begin with, if the appropriate transparency was in place, then we wouldn't be in a position where you're trying to call every recipient and get the basic information that should already be in public documents," she said.

Garrett, the New Jersey congressman, said the nation might never get a clear answer on where hundreds of billions of dollars went.

[generey]

"After Getting Billions In Taxpayer Money, Banks Hush-Hush On Money''s Fate."


Oh my gawd.....This is getting hillarious! Americans are soooooo stupid!

[cariboubarbi]

The Bush administration told us that if we didn''t write them a blank check as soon as possible that it would be "economic Armageddon".

Looks like it was just a last ditch effort to steal more money from the American tax payers.

[hammy06]

Amazing stuff. A good friend of mine graduate and became a doctor this year. With the help of SCORE he put together a great business proposal and has visited 4 banks. Only one of them flat out told him they would not lend. Another simply won''t return his calls. The other two have strung him along for months, consistently saying maybe we''ll know something next week. All four of them said his numbers look good, his plan is well stated, and acknowledged his credit is good. Yet, here it is, almost six months past graduation, student loans ready to come due, and he can''t get a loan from a bank to open a practice.

I feel that we tax payers have gotten hosed by the government and these financial institutions. Congress played games with the auto industry even though millions would lose their jobs should the sector fold. Yet, they couldn''t throw money at the banks fast enough and with no accountability. Why can%u2019t we trust our elected officials to do things in moderation instead of going to extremes one way or the other?

[beowulf39565]

Why after so many spoke out against the Detroit bail did George Bush push it through? Was it because of company named Cerberus Chaired by Bush insider and once Treasury Secretary John W. Snow which owns 80.1% of Chrysler. That stinks a little until you dig deeper and find that Global Investments, Chaired by another Bush crony former Vise President Dan Quayle and led by Cerberus management purchased 51% of GMAC finance in late 2006 at which point it begins to stink a lot. Just who is really getting bailed out? Quayle is also on the board of IAP, and their bread and butter comes from, you guessed it, Gov Contracts. By the way, look the word Cerberus up and you will find it is the name from Greek mythology of a 3 headed dog that guarded the underworld. Sweet!
As far as I can tell Ford Motor that opted out of the bailout doesn%u2019t have a dog in the hunt with regard to these Bush connected investment groups which makes me want to hold my nose even harder than the last time I had to vote for President Bush.
Are you asking yourselves some hard questions right now? I am. I learned of this from Michael Savage on one of the talk radio shows that may soon be silenced by the so called "Fairness Doctrine". I did some research myself as well, links provided below. http://www.cerberuscapital.com/news_press_release.html
http://www.vicepresidentdanquayle.com/biography.html

[noloyalisti]

Corporate Welfare like this is perfectly fine with the American Sheeple. As long as we don''t give to those who need it. Because after all, it is their fault that the corporations and the rich robbed them, right?

[quickly101]

This country is drowning in a sea of corruption, red ink, and moral decadence. Is there any hope for America?, not really.

[brannigon]

WHY ISN''T THE GOVERNMENT DOING ANYTHING ABOUT IT? I DON''T GET IT! THEY GO TO THE GOVERNMENT FOR HELP, THEY GET IT, AND NOW WON''T RELEASE IT OR LET ANYONE KNOW WHERE IT WENT AND WHATS GOING ON WITH IT!!! ITS OUR MONEY!!!!!!

[wardoglrs]

LOOT THE PEOPLE.

As the economist Dr. Stuart Crane was fond of saying, Things in the monetary world don%u2019t just happen to happen. They happen because they were planned to happen.

I believe that banking institutions are more dangerous to our liberties than standing armies. Already they have raised up a monied aristocracy that has set the government at defiance. The issuing power of money should be taken away from the banks and restored to the people to whom it properly belongs." Thomas Jefferson 1743-1826 3rd U.S. President.

By this means [printing money] government may secretly and unobserved, confiscate the wealth of the people, and not one man in a million will detect the theft. John Maynard Keynes 1883-1946 British economist

[random_radar]

Trust me, you are better off not knowing how the money was spent.

And I assure you that quite a bit of that money will find its way back to the congressmen who voted for it.

What goes around comes around, and congress and the bank executives richly deserve the big bonuses and campaign contributions they get for skrewing you over so royally.

[slim1h2o]

This country has really gone to he77.......

[rrozsa-2009]

I don''t care how they spend it, as long as they pay it back! Like that''s ever going to happen.... Sheesh

[jizzumjim]

this is where irresponsible voting gets you.

[ramos937]

Since the banks would provide the uses of this bail out money, the following needs to be done immediately:
(1) pay no attention to Paulson. He is looking out for the interests of the banks exclusively. (2) no more funding from the remaining $350Billion no matter the hue and cry. (3) demand an immediate detailed accounting as to where the doled out $350 billion went to and provide a deadline, (4) if the banks do not comply or if the reasons given are not satisfactory, then somehow divert the remaining $350 billion to folks who are behind in their mortgage payments.

[ramos937]

To Hammy 06......Some suggestions: (1) have your MD friend apply to a local community bank. (2) also have him apply to a credit union that does business loans also. (3) SBA does maintain a listing of banks that are still small business friendly. Go to sba.gov and search for these banks. Good luck and Merry Xmas.

[yongamerica]

Seeing as how the US taxpayers are now shareholders, the banks cannot ignore their shareholders demand to see their books.

The manner in which this bailout was a popup emergency and then the relief doled out with such little oversight or rules is an absolute CRIMINAL ACT.

[noloyalisti]

This is just such a fascist corporate scam THAT I CAN''T EVEN BELIEVE IT. Greed is patriotic, the Republican credo.

Just like in Iraq where nobody knows where all of those billions of dollars went! We have a bunch of con artists in Washington, D.C. who can get away with any crime whatsoever.

[babooph]

The propaganda system sends one loudmouth stoog after the other out to arn against the govt. owning the companies it funds- in private hands,the CEO S bankrupt them -WHAT COULD A GOVT. WORKER DO WORSE THAN THAT !!!!!!

[usgeneral-2009]

Washington actions have set up the economy for continuing disastrous results for a long, long time. Bailout Bernanke and the feckless Fed now have accumulated over $2.2 TRILLION in debts to bailout everybody but my grandmother (evidently, her check is still in the mail) - but they REFUSE to say where the money has gone. (Bloomberg and other organizations have filed FOIA requests for this info- all have been turned down.) The Fed''s money presses are working 7 x 24 to flood the economy (read that: businesses that made this mess) with dollars. This is a time-bomb that will eventually blow up causing horrific problems.

The $700 Billion TARP has been a total failure - the money has gone principally to Wall Street pals of Paulson (aside from the inept d-crat congress, who couldn''t have seen that coming?) And the marxist drug-addict plans to waste another TRILLION on "public works" - most likely a narcissist''s dream: monuments to himself on every street corner.

And, if you can''t figure out who will actually pay for all this, your head must also be up bailout fantasy land.

What is the "bailout exit strategy"?

"Irrational exuberance" has been replaced by "bailout insanity".

[inventagod2]

Never

Ever

Let

Republicons

into

Washington

AGAIN!

[enriquecaliente]

WAKE UP, THE BANKERS ARE THE GOVERNMENT. Each and every politician is in their pockets. We the people are their fodder. We are here to serve them. We are here to die for them. The rich live with their heads firmly up their A$$ets. As long as the people are willing to follow without question, this is what you''ll get.

[indianaman13]

You have to wonder- If they are not keeping track of this taxpayer money, how much money are they really keeping track of legally? Any entity that requests and receives taxpayer money needs to be audited completely. Not only the banks, but all upper echelon executives as well. They are the ones who wanted money from the taxpayer, they are the ones who have screwed the economy, the global marketplace. If 100 upper management executives work at each bank, and 21 banks got money, that is only 2100 people that need to be audited. My my, i know the IRS alone could do that tiny group in a couple of weeks. If they say no, what do they have to hide, they are a bank and are subject to laws and regulations. If the Government fails to enforce its own laws, then the government is owned by the banks. Nothing wrong with our democratic government, only the people in control.

[indianaman13]

100 senators, couple hundred representatives, 1 president, 1 vice president, less than 30 cabinet members. Less than one thousand people, 1000 people or fewer have caused this country of almost 300 million to collapse, destroy the economy, destroy the global market. 1000 people have destroyed America.

[tnz650-2009]

Now I''m a liberal, but those bashing Bush need to remember the smiling, jovial faces of Barney Frank and Nancy Pelosi when they announced the "deal" that was made to get the Bush/Treasury plan passed. There are plenty of bi-partisan hands in the creation of the bail out plan and plenty of blame on both sides for the fact that it''s all going to pot. I don''t have any faith that the Democrats have the guts to do anything usefull. Republicans are greedy, selfish, hatefull, crooked, SOB''s and the Democrats are spineless, cowardly, mealy-mouthed SOB''s. It isn''t even a question of the lesser of two evils any more. Americans need to stand up and tell Washington that they''re not getting any more bail out money. And we need to put our money in LOCAL banks and Credit Union''s with solid, transparent balance sheets. Anyone who still has money in Bank of America or Chase or National City or Commerce Bank, is a fool. Even if your mega-conglomerate bank doesn''t lose any of your meager deposits, you''re still proping up a flawed and dangerously corrupt financial system.

[generey]

WAAAAAAAAAAAH!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

[zwaggsy]

While the damage these bankers have caused to the world economies is phenomenal, you have to admit these guys & gals certainly know how to look out for number 1.

If they were as patriotic & sensible as they are greedy we''d all be secure home owners by now looking forward to our guaranteed pensions!

[generey]

EVERY U.S. FAMILY COULD HAVE RECEIVED $50,000 EACH IN BAILOUT MONEY AND THAT WOULD HAVE REALLY GOTTEN THE ECONOMY GOING AGAIN. THAT WOULD HAVE BEEN MONEY WELL SPENT AND WE KNOW WHERE THAT MONEY WOULD HAVE GONE---BACK INTO THE ECONOMY---NOT SOME SWISS OR CAYMAN BANK ACCOUNT.


--------------------------------------------------------------------------------

Posted by endrepubs at 05:57 PM : Dec 22, 2008

And STILL have enough to feed the hungry, shelter the homeless and much much more, all in this country. Good luck people!

[zwaggsy]

To endrepubs.

Nice idea, but then how would city traders afford their gold plated, diamond encrusted mobile phones?

Have you no compassion at all?

[liberalme]

I''''m a bastward Commie.


Posted by TheMajority1

Good for you, at least you admit to being in the "minority" of the Bush cult!
The first step is admitting the errors of your ways, next is doing something about it.

[debinok1]

A full fledged planned depression designed to lower wages, reduce benefits, and scr3w the american workers. While the rich just keep getting richer.

[debinok1]

When you buy a stock or a mutual fund or a bond, you''''ve converted your real money into something that isn''''t money, but is an illusion.

Maybe we should just keep our paychecks in real money and starve the vampires.

Posted by jbrown88881

What do you think happens when you deposit your check in the bank? Think it sits there and waits for you to come get it? Not hardly, the banks invest it. So starving the vampire as you say would mean closing your bank accounts and using cash only.

[yeswedid]

What do you think happens when you deposit your check in the bank? Think it sits there and waits for you to come get it? Not hardly, the banks invest it. So starving the vampire as you say would mean closing your bank accounts and using cash only.

Posted by DebinOK1 at 06:43 PM : Dec 22, 2008
-----------------------------------
Which we will be getting to soon, hiding $ under mattresses, burying in the back. Circa 1930''s...

[ajc1952]

I as a taxpayer and also a person who is behind in payments to my debtors, get harrassing calls on the hour, every hour until 9:00 p.m. at night when it is then illegal for them to call. I am not trying to not pay these people, but if I tell them I don''t have the money one hour -- what makes them think I will have it the next hour?!? At any rate, I agree with the person who says the money should have went to he taxpayers and not the big corporations who pay their CEO''s outlandish salaries and bonuses, while the rest of the American people -- the ones actually breaking their backs working -- make peanuts. Can the pubic start harrassing them for information concerning the whereabouts of the bailout monies they recieved? Seems only fair and right for them to keep us informed as they want to be kept informed on us, the people they are supposed to be serving. The share the wealth should have been implemented years ago and top executive salaries should have been capped at no more than 150,000 a year. The CEO where I work makes over 800,000.00 a year not counting all the other perks -- WHO NEEDS THAT KIND OF MONEY, while others below him are working at proverty salaries?!?!?

[caldwellptr]

You would think the government would know where the money went. After all, if they can find a money transfer of $5,000 from Eliot Spitzer to the Emperors Club, they can find anything.

[yeswedid]

"Garrett, the New Jersey congressman, said the nation might never get a clear answer on where hundreds of billions of dollars went"

This is enough to make a person physically ill. WHAT THE H*LL IS GOING ON HERE??!! The highest unemployment rate in more than 25 yrs. (people going hungry without heat, etc., etc.) yet these banking officials make off like high-way robbers! As we all just sit back & go on about our lives, turning a blind eye to everything. Like pure FOOLS...

[renonv5]

Posted by ajc1952 Next time they call, tell them you already paid it all back, it was part of the bail-out package.

[renonv5]

The only way these money-grubbing greedy idiots will ever notice the people they are supposed to be working for, is if the money stops coming in! If we, as a people, don''t do anything about it, it will remain the same. It is the definition of insanity: keep doing the same thing over and over and expecting different results.

[u-r-right]

Democrat or Republican. It doesn''t matter. Our government is full of con artists. We need a complete overhaul. Will it happen in our lifetime? It sure seems like their just aren''t enough people in tune with what is really going on. Or is it they don''t care to know?

[farnorth5]

Well WARDOGyou have it right.Back to school everyone!!!Ever since Confederation,there has been an argument going on behind the scenes.SHOULD THE FEGDERAL RESERVE BE EITHER A FEDERAL BANK OWNED BY THE FEDS OR BE A PRIVATE BANK.On Dec 22,1913 the answer was to make it a private bank,owned 20% by the Feds and 80% by persons unknown.The name was THE FEDERAL RESERVE with the President entitled to appoint Governors for 14 year terms.As this meant the Controlling Interest was in unknown hands several people since then took this question to the U.S Supreme Court.Each time they ruled it was PRIVATE.Nothing has changed since .The Bank is operated for the benefit of the Private Controlling Interests.Sorry to break the news ,but the Public dont count.It doesnt matter who you vote for,unless there is a technical change in the banking system world wide.Most Central Banks are "Private Sector"Fortunately all this info is available on line at such locations as "Federal Reserve U.S." or "Fractional Reserve Banking" .

[beowulf39565]

Eye-opening article; and where is an accounting of the Auto companies. Cerberus with 80.1% of Chrysler is Chaired by Bush insider former Secretary of the Treasury John W. Snow. Stink? Sure, former V/P Dan Quayle led by Cerberus management purchased 51% of GMAC finance in late 2006 at which point it begins to stink a lot. Who is really getting bailed out? Google Cerberus, it is a name from Greek mythology of a 3 headed dog that guarded the underworld. Sweet!
It seems Ford Motor that opted out doesn%u2019t seem to have a connection. All this makes me want to hold my nose even harder than the last time I had to vote for President Bush.
Are you asking yourselves some hard questions right now? I am. I learned of this from Michael Savage on one of the talk radio shows that may soon be silenced by the so called "Fairness Doctrine". Checked myself, Ref. below
http://www.cerberuscapital.com/news_press_release.html http://www.vicepresidentdanquayle.com/biography.html

[forasongca]

Don''t give them one more stinkin'' dime of taxpayer money until they promise in writing to account for exactly where it goes. Not. One. Stinking. Dime. No exceptions.

Meanwhile, I''m off to the mattress store to choose my new bank.

[farnorth5]

Well Caribou Barbie ,you have that right only more so .While everyones attention was on the "$700 Billion bailout or "ELSE",The federal Reserve actually gave out $2 Trillion Dollars unaccounted for.(The neat trick about that is that because the Fed is actually a private bank it doesnt have to tell anyone anything)It has no legal obligation to actually publish any form of year end financial statements.What a sweet deal for the owners !!!!!

[slinginrich]

Go to Infowars.com and listen to Gerald Celente''s phone interview with Alex Jones. He lays it all out.
There''s been a Financial Coup of the Government by the Banks and Wall Street in broad daylight, and there WILL BE Worldwide uprisings by the people.
It''s all gone too far and can''t be reversed or fixed by Obama or anyone else. It''s going to be the Second Revolutionary war.

http://www.infowars.com/

[randycarol]

The remainder of this bailout money should NOT be released at all! Just the fact that these folks have the nerve to say they won''t disclose how they have spent what they received so far, is reason enough to know it wasn''t spent the way it should have been. And, the fact that the execs. still got over a billion dollars in bonuses is a slap in the face of every working American. No more welfare for the rich...how about a little more help for the middle class? What a disgrace!!

[twomtns]

Where''d The Bailout Cash Go? It''s A Secret!
wonder how much of this secret cash filtered back to Bush,Cheney & their cronies ??

[pgorey]

The solution is simple. We need a majority of the people to concern themselves with the common welfare of Americans.

[yeswedid]

Am I to believe that people care more about "angels" than they do about this MASSIVE fraud / ripoff?!?!

Posted by IamHungry68 at 08:45 PM : Dec 22, 2008
-----------------------------
Yes, we Americans turn a blind eye to things until it BLOWS UP in our stupid faces. Out of sight, out of mind. Until we start paying up the nose for this in our taxes. Then it will be waaah waaaah waaaaaaaaah!

[yeswedid]

The solution is simple. We need a majority of the people to concern themselves with the common welfare of Americans.

Posted by pgorey at 09:07 PM : Dec 22, 2008
------------------------------
BRAVO & well said.

[cbs_bull]

A secret? Didn''t nearly $1.6 billion go to bank 1.6 executives'' pockets as salaries, bonuses, etc(from yesterday''s report)? This is not capitalism. This is communism. This is robbery. Is the real purpose of the Bush/Cheney/Paulson''s bailout plan is to take care of their friends first?

------------------ (Don''t know why. The ABC News has blocked my ids from posting comments on its site. They also deleted some of my comments. And they refuse to tell me why. I read the CBS news more often now. Guess the freedom of speech is no longer in ABC News'' vocabulary.)

[wavin2ya]

JP Morgan BIG SURPRISE they don''t wanna say where the money went cause I have my mortgage threw them and they have DONE nothing to help prevent my foreclosure EXCEPT want MORE MONEY!!!! The government let the people down, that money should have gone to make ALL their DEFAULT accouts current and then give the BIG GUYS a BIG LUMP OF COAL for putting us there!!!!