Fraud prevention standards weren't imposed. Barofsky doubts the program's longterm success.
On March 29, 2011, he headlined a New York Times op-ed "Where the Bailout Went Wrong," saying:
Two and a half years after legislation passed, Obama officials declared mission accomplished. "On my last day as the special inspector general".I regret to say that I strongly disagree."
TARP and what followed struck out. It "failed to meet some of its most important goals." Main Street was sacrificed for Wall Street.
Congress was told TARP funds would buy up to $700 billion of mortgages. Authorizing legislation (the Emergency Economic Stabilization Act - EESA) emphasized preserving homeownership.
Treasury officials promised help. EESA mandated it. Struggling homeowners got none. Legislative provisions were violated. Treasury changed the rules. Money went to banks with no accountability or mandate to extend credit.
"There were no strings attached: no requirement or even incentive to increase lending to home buyers, and against our strong recommendation, not even a request that banks report how they used TARP funds."
Instead of increased lending, it declined. As inspector general, Barofsky had no enforcement power. He could only recommend. Suggested policies fell on deaf ears. Treasury and Wall Street conspired to commit grand theft. Ordinary people were hung out to dry and scammed.
Helping homeowners was shelved. The Home Affordable Modification Program (HAMP) was introduced. Obama promised four million families help. The program was "a colossal failure."