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Overbroad TARP – US Plan Found to Be Covering Excessive Legal Fees

The Troubled Asset Relief Program is feeling some heat today after a report criticizing the payment of law firms was released. The Special Inspector General for TARP questioned $8.1 million of the 9.1 million dollars in billings from four law firms that were utilized. The report criticized bills submitted with little or no details on the services provided. The watchdog organization examined bills by Simpson Thacher, Cadwalader, Locke Lord Bissel & Liffell and Bingham McCutchen LLP.

The report singled out Simpson Thacher singularly for exceptionally excessive bills submitted. The report said auditors questioned $5.8 million dollars worth of fees and expenses billed that provided no detail at all to explain the work provided. The report further cautioned that although some entries were objectionable, all of the billings were not per se unreasonable. The Special Inspector General is asking the Treasury to determine the allowable amount as just under $8 million of the fees, and that the Treasury try to recover $91,482 from “ineligble” fees and expenses in the Simpson Thacher billings.

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