Issa panel to start with TARP hearing

By: Jake Sherman January 19, 2011 06:00 AM EST

The foreclosure crisis and TARP will be the subject of Rep. Darrell Issa’s (R-Calif.) first hearing as chairman of the House Oversight and Government reform committee. Both Neil Barofsky, TARP’s watchdog, and Treasury Secretary Timothy Geithner are invited to participate in “Bailouts and the Foreclosure Crisis: Report of the Special Inspector General for the Troubled Asset Relief Program” on Jan. 26. The hearing is scheduled on the same day that Barofsky is slated to deliver his quarterly report to Congress. Barofsky, the special inspector general for the bailout, is responsible for the oversight of TARP and programs like the Home Affordable Mortgage Program — the Obama administration’s effort to modify home loans. The hearing is the fulfillment of an agreement between Issa and Ranking Democrat Elijah Cummings (Md.) — the pair vowed to investigate the foreclosure crisis as one of their first hearings. Barofsky, who was appointed as TARP’s watchdog by former President George W. Bush, has purview over the Home Affordable Mortgage Program — the Obama administration’s effort to modify home loans in place of foreclosure. He has been pointedly critical of the program in the past. Cummings, whose district was hit hard by the mortgage meltdown, and Republicans will have the opportunity to question Barofsky and Treasury over the program’s success. Questions are bound to also to turn to what some consider mismanagement of TARP. While lawmakers on both sides of the aisle contend the program helped keep financial markets from collapsing, some Republicans — including Issa —have questioned recipients like the American International Group over its full payment of insurance contracts to big banks after a government bailout. This is an issue that Barofsky and Cummings have also shown interest in.