Another gift from Geithner to the politically connected. We've got proof.
The GMAC, and now industry wide story of foreclosure fraud leaves us no choice but to revisit the GMAC bailout. It should never have happened. It was the most controversial of all the TARP bailouts. There was no strategic importance to saving GMAC. It was a gift to the politically connected.
2 very good short clips, plus links and detail.
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Video: The Unique Treatment of GMAC Under TARP
GMAC received $18 billion of TARP funds and Elizabeth Warren says we could lose more than $6 billion.
WASHINGTON (AP) -- The Treasury Department sank billions into auto finance giant GMAC Inc. without an exit strategy or proof the company was viable -- a decision that could cost taxpayers $6.3 billion, a new watchdog report says.
The government said the $17.2 billion bailout was a necessary step to save troubled automakers General Motors and Chrysler. GMAC provides critical financing to auto dealers, who borrow to finance their fleets until the cars can be sold to consumers.
Yet GMAC faced far fewer conditions than the bailed-out automakers, the report says. When the automakers were rescued, they were forced into bankruptcy. Shareholders lost their investments, creditors took a hit and executives were forced to detail plans for making the companies viable.
GMAC was treated more like banks that received bailouts without having to explain what they were doing with the money, the report says.
The report was released Thursday by the Congressional Oversight Panel overseeing the $700 billion financial bailout that Congress passed in October 2008.
"Treasury missed many opportunities to improve accountability and protect taxpayer money," panel chair Elizabeth Warren said in a conference call with reporters. She said Treasury didn't make GMAC show how it would return the taxpayer money, or how the investment would increase credit to consumers.
"These decisions mean that Treasury is now struggling to deal with a GMAC that is not financially rehabilitated, Treasury has no exit strategy and taxpayers are not fully protected," Warren said.
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