New Momentum for TARP Transparency Bill After Last SIGTARP Report?

Friday, October 23, 2009 3:52 PM by Bailouts

In the wake of the Special Inspector General for TARP's latest report, which found that it is doubtful that taxpayers will be getting their money's worth from the program, momentum may be building for Rep. Maloney's and Rep. King's TARP Accountability and Disclosure Act, especially as fraud in the program remains a concern. Writes Federal Computer Week:

As money continues to be spent under TARP, some members of the House hope to amend the program to direct Treasury to use technology to detect fraud, according to industry experts that advised Congress about the technology. Credit card companies, using such tools, can call a customer as soon as a suspicious transaction takes place because the software detects activity that doesn't match a customer’s normal behavior, said Stephen Horne, vice president of master data management and integration services at Dow Jones.

Similar technology could alert federal government officials about fraudulent spending under TARP, Horne said at a recent panel discussion .

Reps. Carolyn Maloney (D-N.Y.) and Peter King (R-N.Y.) introduced a bill, H.R. 1242, earlier this year that is now in the House Financial Services Committee. It has 40 co-sponsors from both parties.

The bill, which CFA supports, would consolidate and transform TARP data into a serialized database hosted by the Department of the Treasury and accessible to the Special Inspector General of the Troubled Assets Relief Program, the Comptroller General, and the Congressional oversight panel. Consequently, those tasked with monitoring the implementation of the program will be provided with a useful tool to better monitor and trace transactions, and thereby spot potential problems in a timely fashion.

Continues the story:

Technologies such as data mining are well suited to discover fraud in TARP, said Tom Kimner, risk manager the SAS Institute's Americas Risk Practice. Kimner testified before a congressional committee about the role data mining can play in TARP oversight.

“Analytic technologies can help identify patterns and anomalies, optimize where the funds are applied, and pinpoint use and abuse of funds,” Kimmer said. “Before you reach that point, though, you must have confidence in the accuracy of the data. Technologies supporting data collection, integration and quality are critical in that effort.”

Because the bill would require the database to be public, it could be a boon for private developers that come up with new ways to use the data, Maloney said.

“We all live in an information economy now,” Maloney said. “Those who build a better mousetrap to present existing information in a new way can often profit from their insight; it’s truly the American way.”

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