Fiduciary-Based Standards for Bailout Contractors: What the Treasury Got Right and Wrong in TARP
Washington University in Saint Louis - School of Law
May 1, 2011
Minnesota Law Review, Vol. 95, No. 5, 2011
Washington University in St. Louis Legal Studies Research Paper No. 11-06-01
Congress authorized the Treasury Department to use outside entities (contractors and financial agents) to implement the TARP bailout program. Treasury embraced this authority, engaging in the wholesale delegation of the administration of TARP to these outsiders. While outsourcing government work is common, one aspect of Treasury’s outsourcing is not: its imposition of fiduciary-based ethics standards on these outsiders.
This Article examines Treasury’s imposition of ethics standards on its contractors and financial agents. It identifies one provision in Treasury’s agreements with these outsiders that until now has escaped scrutiny: the requirement that outsider personnel submit manuscripts relating to their TARP work to Treasury prior to publication, even if the manuscript does not contain any confidential information. This requirement for pre-publication review is unusual outside the intelligence field. This Article recommends that before imposing additional ethics standards on government contractors, the government should examine Treasury’s experience more closely to determine the costs and benefits of imposing such standards.
Number of Pages in PDF File: 24
Keywords: corruption, ethics, fiduciary duty, public law, conflict of interest, bailouts, public procurement, government contract, outsourcing, acquisition workforce, suspension, debarment, oversight outsourcing, privatization, blended workforce, personal services contracts, procurement spending
Date posted: June 9, 2011 ; Last revised: November 10, 2011