Remember all of the criticism about the financial industry bailout several months ago? And the criticism about the lack of transparency?
A new article from the Associated Press titled “Where’d the bailout money go? Shhhh, it’s a secret” says that many banks are either not tracking how they are spending the money or are simply refusing to disclose it. The AP surveyed 21 banks that have received $1 billion in government money and asked for simple 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 that accounted for how they have used the money. However, there were some choice responses:
“We’ve lent some of it. We’ve not lent some of it. We’ve not given any accounting of, ‘Here’s how we’re doing it,'” said Thomas Kelly, a spokesman for JPMorgan Chase, which received $25 billion in emergency bailout money. “We have not disclosed that to the public. We’re declining to.”
“We’re choosing not to disclose that,” said Kevin Heine, spokesman for Bank of New York Mellon, which received about $3 billion.
“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.
The largest recipients of money–Bank of America and CitiGroup–simply responded with PR statements saying that the money is being used to “strengthen balance sheets and continue making loans to ease the credit crisis.”
TheRealNews.com has a great video that explains the flaws over the oversight system: