Bailout Watchdog Questions All $5.8 Million of Simpson Thacher’s Legal Fees

Michael Smallberg
Project on Government Oversight

As a taxpayer, you have to love a watchdog report with a chapter heading that reads:

“SIGTARP Questioned All $5.8 Million of Simpson Thacher’s Legal Fees Because Simpson Thacher Did Not Provide Any Description of Work Performed or Any Receipts for Expenses”

That’s from a report issued yesterday by the Special Inspector General for the Troubled Asset Relief Program (SIGTARP).

At the request of Senator Tom Coburn (R-OK), the SIGTARP reviewed the Treasury Department’s oversight of five law firms that received more than $27 million to provide legal services for Treasury’s bailout programs. In April, the SIGTARP released an audit finding that Treasury’s inadequate oversight of one firm, Venable LLP, had created an “unacceptable risk” that taxpayers were being overcharged. Yesterday’s audit focused on Treasury’s oversight of its contracts with the other four firms: Simpson Thacher & Bartlett LLP, Cadwalader Wickersham & Taft LLP, Locke Lord Bissell & Liddell LLP, and Bingham McCutchen LLP.

Treasury’s Office of Financial Stability (OFS), which oversees the TARP, has paid these four firms more than $25.5 million in legal fees and expenses. The SIGTARP reviewed $9.1 million of these fee bills, and found that $8.1 million (89 percent) should be called into question because there was no way to determine the reasonableness of individual hourly charges and expenses…

The article continues at POGO.

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