Today, the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) released a report requested by Dr. Coburn questioning the administration of TARP funds to law firms, exposing potentially wasteful spending of taxpayer dollars by the Treasury Department’s bailout office. The Treasury Office of Financial Stability, responsible for administering the Troubled Assets Relief Program (TARP), has spent tens of millions of taxpayer dollars on outside legal fees to assist its efforts. Among the findings highlighted in the report, SIGTARP concluded that OFS paid the law firm, Venable LLC, hundreds of thousands of dollars despite inadequate and vague billing. After reviewing $1 million worth of Venable’s bills, SIGTARP found lawyers charged the Treasury office to review their own firms’ potential conflicts of interest, holding hours-long meetings with each other, and preparing their own expensive bills.

Key excerpts:

“Venable submitted, and OFS paid without questioning, fee bills that contained…vague and inadequate descriptions of work, and administrative charges not allowed under the contract.”

“OFS’ current contracts and fee bill review practices create an unacceptable risk that Treasury, and therefore the American taxpayer, is overpaying for legal services.”

In concluding the audit, SIGTARP lists recommendations for the OFS to tighten its controls by requiring firms to provide a more detailed and thorough account of bills, and other ways to implement improvement.

In the coming months, SIGTARP states its intent to release findings on the other legal firms, as well as conclusions on the hourly rate lawyers are billing Treasury.

Full SIGTARP report here.