§5226 — Title 12 Banks and Banking | U.S. Code

Summary

When the Troubled Asset Relief Program (TARP) starts, the Comptroller General must begin ongoing oversight and audits of TARP, any TARP-created entities, any Federal Reserve bank entities that get TARP funding, and other non‑government participants working under TARP. The oversight looks at many things: how well TARP meets its goals (for example, foreclosure help, cutting costs, market or banking stability, protecting taxpayers, and public accountability); TARP’s finances and internal controls; the kinds of deals made and assets bought or sold; how efficiently appropriated money is used; whether TARP follows laws; steps to avoid conflicts of interest; and contracting practices under section 5217(b), including efforts to include minorities, women, and minority- and women-owned businesses and the total fees paid to agents and those firms. The Comptroller General may see and copy any TARP records, talk to officers, employees, accountants, advisors, and agents, and verify transactions with banks, fiscal agents, and custodians. Contracts with TARP participants must allow that access. Proprietary or trade‑secret material cannot be publicly released, but may be shown to the appropriate congressional committees. The Treasury must pay the Government Accountability Office (GAO) for these oversight costs. TARP must publish audited financial statements every year using generally accepted accounting principles, and the Comptroller General will audit them. The Comptroller General will report findings yearly to Congress and to the Special Inspector General for TARP, and may issue special reports. The Comptroller General may audit TARP programs and finances at other times, and TARP must fix any problems found or certify that no fix is needed. TARP must keep effective internal controls that meet the standards in 31 U.S.C. 3512(c), and must include management’s responsibility statement and its assessment of control effectiveness with each annual statement. All reports and audits must also go to the Congressional Oversight Panel at section 5233. Oversight ends on the later of the date the last troubled asset acquired under section 5211 is sold or transferred out of government ownership, or the date the last insurance contract issued under section 5212 expires.

Title 12, §5226

Banks and Banking — Source: USLM XML via OLRC

(a)(1)The Comptroller General of the United States shall, upon establishment of the troubled assets relief program 11 So in original. Probably should be “Troubled Asset Relief Program”. under this chapter (in this section referred to as the “TARP”), commence ongoing oversight of the activities and performance of the TARP and of any agents and representatives of the TARP (as related to the agent or representative’s activities on behalf of or under the authority of the TARP), including vehicles established by the Secretary under this chapter. The subjects of such oversight shall include the following:

(A)The performance of the TARP in meeting the purposes of this chapter, particularly those involving—

(i)foreclosure mitigation;

(ii)cost reduction;

(iii)whether it has provided stability or prevented disruption to the financial markets or the banking system;

(iv)whether it has protected taxpayers; and

(v)public accountability for the exercise of such authority, including with respect to actions taken by those entities participating in programs established under this chapter.

(B)The financial condition and internal controls of the TARP, its representatives and agents.

(C)Characteristics of transactions and commitments entered into, including transaction type, frequency, size, prices paid, and all other relevant terms and conditions, and the timing, duration and terms of any future commitments to purchase assets.

(D)Characteristics and disposition of acquired assets, including type, acquisition price, current market value, sale prices and terms, and use of proceeds from sales.

(E)Efficiency of the operations of the TARP in the use of appropriated funds.

(F)Compliance with all applicable laws and regulations by the TARP, its agents and representatives.

(G)The efforts of the TARP to prevent, identify, and minimize conflicts of interest involving any agent or representative performing activities on behalf of or under the authority of the TARP.

(H)The efficacy of contracting procedures pursuant to section 5217(b) of this title, including, as applicable, the efforts of the TARP in evaluating proposals for inclusion and contracting to the maximum extent possible of minorities (as such term is defined in 1204(c) 22 So in original. Probably should be preceded by “section”. of the Financial Institutions Reform, Recovery, and Enhancement Act of 1989 33 See References in Text note below. (12 U.S.C. 1811 note), women, and minority- and women-owned businesses, including ascertaining and reporting the total amount of fees paid and other value delivered by the TARP to all of its agents and representatives, and such amounts paid or delivered to such firms that are minority- and women-owned businesses (as such terms are defined in section 1441a 3 of this title).

(2)(A)In this paragraph, the term “governmental unit” has the meaning given under section 101(27) of title 11, and does not include any insured depository institution as defined under section 1813 of this title.

(B)The Secretary shall provide the Comptroller General with appropriate space and facilities in the Department of the Treasury as necessary to facilitate oversight of the TARP until the termination date established in section 5230 3 of this title.

(C)(i)Notwithstanding any other provision of law, and for purposes of reviewing the performance of the TARP, the Comptroller General shall have access, upon request, to any information, data, schedules, books, accounts, financial records, reports, files, electronic communications, or other papers, things, or property belonging to or in use by the TARP, any entity established by the Secretary under this chapter, any entity that is established by a Federal reserve bank and receives funding from the TARP, or any entity (other than a governmental unit) participating in a program established under the authority of this chapter, and to the officers, employees, directors, independent public accountants, financial advisors and any and all other agents and representatives thereof, at such time as the Comptroller General may request.

(ii)The Comptroller General shall be afforded full facilities for verifying transactions with the balances or securities held by, among others, depositories, fiscal agents, and custodians.

(iii)The Comptroller General may make and retain copies of such books, accounts, and other records as the Comptroller General determines appropriate.

(D)Each contract, term sheet, or other agreement between the Secretary or the TARP (or any TARP vehicle, officer, director, employee, independent public accountant, financial advisor, or other TARP agent or representative) and an entity (other than a governmental unit) participating in a program established under this chapter shall provide for access by the Comptroller General in accordance with this section.

(E)(i)The Comptroller General may not publicly disclose proprietary or trade secret information obtained under this section.

(ii)This subparagraph does not limit disclosures to congressional committees or members thereof having jurisdiction over a private or public entity referred to under subparagraph (C).

(iii)Nothing in this section shall be construed to alter or amend the prohibitions against the disclosure of trade secrets or other information prohibited by section 1905 of title 18, section 714(c) of title 31, or other applicable provisions of law.

(F)The Treasury shall reimburse the Government Accountability Office for the full cost of any such oversight activities as billed therefor by the Comptroller General of the United States. Such reimbursements shall be credited to the appropriation account “Salaries and Expenses, Government Accountability Office” current when the payment is received and remain available until expended.

(3)The Comptroller General shall submit reports of findings under this section annually to the appropriate committees of Congress, and the Special Inspector General for the Troubled Asset Relief Program established under this chapter on the activities and performance of the TARP. The Comptroller may also submit special reports under this subsection as warranted by the findings of its oversight activities.

(b)(1)The TARP shall annually prepare and issue to the appropriate committees of Congress and the public audited financial statements prepared in accordance with generally accepted accounting principles, and the Comptroller General shall annually audit such statements in accordance with generally accepted auditing standards. The Treasury shall reimburse the Government Accountability Office for the full cost of any such audit as billed therefor by the Comptroller General. Such reimbursements shall be credited to the appropriation account “Salaries and Expenses, Government Accountability Office” current when the payment is received and remain available until expended. The financial statements prepared under this paragraph shall be on the fiscal year basis prescribed under section 1102 of title 31.

(2)The Comptroller General may audit the programs, activities, receipts, expenditures, and financial transactions of the TARP and any agents and representatives of the TARP (as related to the agent or representative’s activities on behalf of or under the authority of the TARP), including vehicles established by the Secretary under this chapter.

(3)The TARP shall—

(A)take action to address deficiencies identified by the Comptroller General or other auditor engaged by the TARP; or

(B)certify to appropriate committees of Congress that no action is necessary or appropriate.

(c)(1)The TARP shall establish and maintain an effective system of internal control, consistent with the standards prescribed under section 3512(c) of title 31, that provides reasonable assurance of—

(A)the effectiveness and efficiency of operations, including the use of the resources of the TARP;

(B)the reliability of financial reporting, including financial statements and other reports for internal and external use; and

(C)compliance with applicable laws and regulations.

(2)In conjunction with each annual financial statement issued under this section, the TARP shall—

(A)state the responsibility of management for establishing and maintaining adequate internal control over financial reporting; and

(B)state its assessment, as of the end of the most recent year covered by such financial statement of the TARP, of the effectiveness of the internal control over financial reporting.

(d)Any report or audit required under this section shall also be submitted to the Congressional Oversight Panel established under section 5233 of this title.

(e)Any oversight, reporting, or audit requirement under this section shall terminate on the later of—

(1)the date that the last troubled asset acquired by the Secretary under section 5211 of this title has been sold or transferred out of the ownership or control of the Federal Government; or

(2)the date of expiration of the last insurance contract issued under section 5212 of this title.

Notes & Related Subsidiaries

Editorial Notes

References in Text

This chapter, referred to in subsecs. (a) and (b)(2), was in the original “this Act” and was translated as reading “this division”, meaning div. A of Pub. L. 110–343, Oct. 3, 2008, 122 Stat. 3765, known as the Emergency Economic Stabilization Act of 2008, to reflect the probable intent of Congress. For complete classification of division A to the Code, see

Short Title

note set out under section 5201 of this title and Tables. section 1204 of the Financial Institutions Reform, Recovery, and Enhancement Act of 1989, referred to in subsec. (a)(1)(H), probably means section 1204 of the Financial Institutions Reform, Recovery, and

Enforcement

Act of 1989, Pub. L. 101–73, which is set out as a note under section 1811 of this title. section 1441a of this title, referred to in subsec. (a)(1)(H), was repealed by Pub. L. 111–203, title III, § 364(b), July 21, 2010, 124 Stat. 1555. section 5230 of this title, referred to in subsec. (a)(2)(B), was so in the original, but probably should have been a reference to section 120 of title I of div. A of Pub. L. 110–343, which is classified to section 5230 of this title.

Amendments

2016—Subsec. (a)(3). Pub. L. 114–301 substituted “annually” for “, regularly and no less frequently than once every 60 days,”. 2009—Subsec. (a)(1)(A)(v). Pub. L. 111–22, § 601(1), added cl. (v). Subsec. (a)(2). Pub. L. 111–22, § 601(2), added subpars. (A) to (E), redesignated former subpar. (C) as (F), and struck out former subpars. (A) and (B) which related to GAO presence and access to records, respectively.

§5226 Oversight and audits