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Begich Supports Federal Reserve Audit


One-time audit garners bipartisan support in Senate

Continuing efforts to identify causes of the economic recession and prevent a repeat of actions that led to it, U.S. Sen. Mark Begich was a co-sponsor of a successful amendment to the Wall Street reform legislation authorizing an unprecedented one-time government audit of all of the emergency activities of the Federal Reserve (the Fed).

By a vote of 96 – 0, the approved amendment would allow the Government Accountability Office to audit the Fed’s emergency-response programs and require the Fed to publish a list of all recipients of emergency assistance since December 1, 2007. The list must be published online by December 1, 2010.

“The Federal Reserve’s ability to dole out trillions of dollars and decide the future of our financial institutions without having to report on a single dime is an outdated policy,” Begich said. “The Fed’s closeted decisions left Alaska families, banks and small businesses at the whim of Wall Street and Washington D.C. Transparency is a necessary step to understand the Fed’s actions and determine the causes of the financial crisis.”

The audit will include the Mortgage Backed Securities Program, foreign currency liquidity swap lines, the Term Auction Facility and emergency programs created since December 1, 2007.

The Fed has not been subject to an audit in its 95-year-history. During the financial crisis, the Fed distributed more than $2 trillion in loans.

Wall Street reform legislation is currently being considered on the Senate floorThe House of Representatives has passed similar legislation and the final terms of a Fed audit will be subject to Senate passage and deliberation between the two chambers.

The Senate also unanimously adopted an amendment based on the bipartisan “Pay it Back Act.” Cosponsored by Sen. Begich, the amendment reduces the authority of the Troubled Asset Relief Program (TARP) by $150 billion, prohibits Treasury from redirecting unused funds for new programs, and requires repaid TARP funds be used for deficit reduction.

A total of $108.8 billion in repaid banking, house and auto bailout funds have already been returned to the U.S. Treasury. The amendment approved today also helps end the American Recovery and Reinvestment Act by directing all ARRA funds not obligated by December 31, 2012 be returned to the Treasury and used to pay down the national deficit.

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