Dodd would establish a Special Inspector General for the TARP
It shall be the duty of the Special Inspector General for the Troubled Asset Program to conduct, supervise, and coordinate audits and investigations of the purchase, management, and sale of assets by the Secretary of the TreasuryHe would require the Fed to report on any use of its discounting authority under 12 USC 343
(1) the justification for exercising the authority; andProvides for a study of financial leverage
(2) the specific terms of the actions of the Board, including the size and duration of the lending, the value of any collateral held with respect to such a loan, the recipient of warrants or any other potential equity in exchange for the loan, and any expected cost to the taxpayer for such exercise.
(A) an analysis of the roles and responsibilities of the Board, the Securities and Exchange Commission, the Secretary of the Treasury, and banking regulators with respect to monitoring leverage and acting to curtail excessive leveraging;And an impact assessment of the TARP
(B) an analysis of the authority of the Board to regulate leverage, including by setting margin requirements, and what process the Board used to decide whether or not use its authority; and
(C) recommendations for the Board and Congress with respect to the existing authority of the Board.
The Comptroller General shall conduct a study to assess the impact of the program authorized by this Act, including—Dodd sets (gentle) executive compensation limits
(A) whether it has—
(i) provided stability or prevented disruption to the financial markets or the banking system; and
(ii) protected taxpayers;
(1) limits on compensation to exclude incentives for executives to take risks that the Secretary deems to be inappropriate or excessive;Funds money-market fund insurance out of the TARP (and forbids the use of the Exchange Stabilization Fund)And makes slight changes to the mortgage modification code
(2) a claw-back provision for incentive compensation paid to a senior executive based on earnings, gains, or other criteria that are later proven to be inaccurate; and
(3) such limitations on the entity paying severance compensation to its senior executives as are determined to be appropriate in the public interest in light of the assistance being given to the entity.