$132.9 Billion Owed to Taxpayers from 2008 Financial Bailouts

Are you outraged yet? You should be. American taxpayers are still owed $132.9 billion by companies that benefited from the 2008 financial bailouts and haven’t fully repaid.

Some of that money will never be recovered, says a government watchdog agency.

Christy Romero, the acting special inspector general for the massive $700 billion bailout, has stated that the bailouts that began in September of 2008 could actually last for several more years, if you can believe that.

Romero said that some bailout programs, such as the effort to reduce home foreclosures, will last through the year 2017 and such programs could cost an additional $50 billion – or more.

American International Group Inc. (AIG), which is among the largest of the 458 bailed-out companies, owes about $50 billion. Other big firms like General Motors and Ally Financial owe $25 billion and $12 billion, respectively.

Following the devastating financial crisis of 2008, Congress authorized $700 billion for the bailout of financial companies and automakers. This was called Troubled Asset Relief Program (TARP) and about $413 billion was lent out to various firms.

The government has recovered about $318 billion, or about 77 percent of that so far, according to reports. The Treasury bailed out these companies in the form of loans and converted its loans to some of the recipients into common shares in those companies.

The thing is, those shares are currently trading below the Treasury’s break-even prices.

Romero said 371 banks still owe money. Some of those banks include:

- Regions Financial Corp.: $3.5 billion

- Zions Bancorporation: $1.4 billion

- Synovus Financial Corp.: $967.9 million

- Popular Inc.: $935 million

- First Bancorp of San Juan, Puerto Rico: $400 million; an

- M&T Bank Corp.: $381.5 million

In Romero’s quarterly report to Congress, she said her office has uncovered and prevented fraud related to TARP. Investigations by her office have resulted in criminal charges against 10 people and three convictions, the report notes.

“TARP is not over,” Romero noted.

Related articles

• Taxpayers owed $132.9 billion and may never get it back (content.usatoday.com)
• Report: Taxpayers still owed $132.9 billion from bailout (mysanantonio.com)
• U.S. taxpayers still owed $132.9 billion from bailout: watchdog (ctv.ca)