... the Treasury Department is allowing another bank to return money loaned to it under the Troubled Asset Relief Program (TARP), it is still keeping one institution – TCF Financial – in the lurch, declining to tell it or CNSNews.com why it has taken more than the required 30 days to process the money-return request.
TCF Financial, based in Wayzata, Minn., also thinks that Congress has changed the rules and would like to return taxpayers’ money as soon as possible. However, according to TCF spokesman Jason Korstange, the Treasury Department has not approved the return yet, nor have they told TCF why they are taking so long.
“Not yet, we’re hoping to hear any minute, any day,” Korstange told CNSNews.com. “We have not heard back. We have certainly talked to them, but we haven’t received an answer yet.”
Korstange said that Treasury had not provided a reason for the delay, but noted that TCF had given Treasury everything it asked for.
“No reasons,” he said. “We’ve given them a lot of information, any information they ask for, any information we thought was necessary.”
Korstange explained that Treasury had originally invited TCF to apply for TARP funds, saying it wanted the participation of healthy banks to mitigate the shock to the financial system from the failure of large firms like Lehman Brothers and Bear Stearns.
TCF agreed, wanting to do its civic duty by aiding the government in keeping the nation’s hobbled financial industry going.
“They came to all the banks,” said Korstange. “They did come to us and suggested that it would be a good idea, that if you didn’t take it you would be looked on as a bank that couldn’t get it, that you were too bad to get it.
“It made sense to do it at that time. We thought we were being good citizens. We didn’t need the money,” Korstange added.
The $700-billion TARP was passed by Congress and signed into law by President George W. Bush last fall.
The law says that the Treasury Secretary "is authorized to establish the Troubled Asset Relief Program (or ‘TARP’) to purchase, and to make and fund commitments to purchase, troubled assets from any financial institution, on such terms and conditions as are determined by the Secretary, and in accordance with this Act and the policies and procedures developed and published by the Secretary. ...
“The term ‘financial institution’ means any institution, including, but not limited to, any bank, savings association, credit union, security broker or dealer, or insurance company, established and regulated under the laws of the United States or any State, territory, or possession of the United States ...."
Korstange said that changing the rules of TARP and demonizing banks that participate in it ultimately hurts the government’s own efforts, because the TARP program is the best recovery program the government is offering.
“It’s the best thing the government has going for it right now, as a matter of fact, [because] it’s not given to the bank, it’s a loan,” Korstange told CNSNews.com. “We’re paying dividends on it. They’re getting 5 percent. To be perceived as this ogre that’s out there gobbling up all this tax money is just wrong.”
That negative perception, fueled by the actions of both the Obama administration and Congress, pushed TCF to get out of TARP. Korstange said that when the government decided it could tell banks how to do business, it had gone too far.
Comment: Once the government's hand get's in your pocket it's hard to get it out!