Some top recipients of US bailout money owe the federal government more than $220 million in unpaid taxes, a US lawmaker said on Thursday. Representative John Lewis, a Democrat from Georgia who heads the US House of Representatives Ways and Means oversight subcommittee, said 13 bailed-out companies owe the federal government taxes. Two of them owe more than $100 million each.
Lewis said the firms, which he did not name, signed statements at the time of receiving federal aid stating that they owed no federal taxes. Lewis said the matter raises further questions about the $700 billion financial bailout program also known as the Troubled Asset Relief Program, or TARP. "Are they signing contracts knowing that they owe taxes by thinking they will not get caught," Lewis said at a hearing to examine the oversight of TARP. "It is a disgrace. The American people are fed up... and theyre not going to take it anymore." So far, more than $300 billion of TARP funds have been disbursed to financial services institutions including Citigroup, Bank of America and giant insurer American International Group.
AIG is now being heavily criticised for accepting up to $180 billion in government funds and then handing out hefty bonuses. TARP watchdog, Neil Barofsky, told the congressional panel that he plans to launch an audit examining federal monitoring and enforcement of executive compensation restrictions imposed on companies that have received government help such as AIG.
Barofsky, TARPs inspector general, said his office will be looking closely to ensure bonuses to AIG employees are consistent with AIGs legal or contractual obligations. "If there are any inconsistencies, we will act aggressively to recover taxpayers money," Barofsky told the panel.