The Impossible-To-Track Bank Bailout

Stack of money wrapped in red bow and ribbon.
Stack of money wrapped in red bow and ribbon.

Government officials promised no secrets. In their own words:

"We need transparency," Treasury Secretary Henry Paulson said.

"The bright light of accountability," House Speaker Nancy Pelosi said.

"People need to see what we're doing," Interim Assistant Secretary of the Treasury Neel Kashkari said.

Yet almost four months into the biggest bailout in history, the Treasury Department is under intense fire for secrecy as to how banks got and spent taxpayer billions, CBS News investigative correspondent Sharyl Attkisson reports.

Even companies that the Treasury Department hired to manage the bailout have been allowed to keep crucial details away from the public eye.

The contracts were awarded to handpicked auditors and law firms without competitive bidding. The bill is $37 million tax dollars - and growing by the minute.

Yet in one contract after another, vital information is blacked out, such as how much people are getting paid and who the key players are. There's even the Bank of New York Mellon which got $3 billion in bailout money - and got hired to manage the bailout, too. How much are they being paid? Blacked out.

Treasury calls the missing information "proprietary," a business secret. But the watchdog appointed by Congress says it ought to be public.

"If I had my way, there would not be contracts with blacked-out portions," said Elizabeth Warren of the Congressional Oversight Panel. "If you're going to take taxpayer money, then the deal has to be that you're open and above board with the American people."

It gets even worse. The secrecy also extends to an even bigger rescue program you may not have heard about at all.

Last September, the Federal Reserve quietly relaxed its rules for giving loans to banks and institutions. Since then, it's loaned out $1.2 trillion.

And even Congress can't get a top banking regulator to tell who got the money.

"Which institutions received that and how much for each institution?" asked Rep. Alan Grayson.

Federal Reserve vice-chair Donald Kohn said, on Jan. 13, 2009: "I'd be very concerned, Congressman, that if we published the individual names of those borrowing from us, no one would borrow from us."

Grayson responded: "You're saying that entitles you to keep secret the $1.2 trillion? Four thousand dollars for every man, woman and child in this country?"

"I don't think we're keeping it secret," Kohn said. "I think we're releasing a lot of information about it."

But this is about more than whom was receiving what money. All this secrecy may make it impossible to know whether all the spending is doing any good.

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    Sharyl Attkisson is a CBS News investigative correspondent based in Washington.