Rep. John Shadegg, R-Ariz., has requested that the oversight board for the Troubled Asset Relief Program probe whether lawmakers have unduly influenced Treasury to make loans through the program to local banks in their states. Shadegg wrote today to Elizabeth Warren, chairwoman of the oversight committee, to investigate whether any TARP allocations have been influenced by political pressure. Shadegg noted a recent Wall Street Journal story that House Financial Services Chairman Barney Frank spoke to regulators about a capital infusion for OneUnited Bank in Boston and had included a provision in the bill creating the program to aid the bank. "If true, this is outrageous and severely undermines public confidence in our nation's government. The purpose of my letter is to request that you immediately investigate all of the issues raised above. If in fact any political pressure was brought to bear, in violation of either House or Senate ethics rules, or any of our nation's laws, aggressive action should be taken against all involved," Shadegg wrote.
"We have been working to ensure that minority-owned and community banks -- in a manner consistent with safety and soundness concerns -- receive fair treatment as we work to rescue financial system," said a Frank spokesman. "This was done in a very open process and the legislation was there for everyone to see." Caleb Weaver, a spokesman for the oversight panel, said it has been looking into such issues. "We raised this issue in both of our last reports and recognize the seriousness of these new allegations, and we will continue to press Treasury for an answer to our questions on this matter," he said in a statement. "The results of our work will be presented in the Panel's upcoming monthly reports."