Reuters: Regulatory News: U.S. watchdog to probe Florida's use of bailout money -senator

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U.S. watchdog to probe Florida's use of bailout money -senator Apr 11th 2013, 22:24 WASHINGTON, April 11 | Thu Apr 11, 2013 6:24pm EDT WASHINGTON, April 11 (Reuters) - A federal watchdog will probe whether the state of Florida misused a fund that was supposed to help homeowners hurt by the 2007-09 recession, U.S. Senator Bill Nelson of Florida said on Thursday. Nelson said the special inspector general for the Troubled Asset Relief Program, which investigates fraud and waste in 2008 federal bailout of the U.S. financial sector, had agreed to his request for a probe. Nelson, a Democrat, said Florida underutilized the bailout's "Hardest Hit Fund," which has given money to state and local housing finance agencies to help troubled borrowers. "The state of Florida would never spend the money," Nelson said during a hearing. A spokesperson for SIGTARP declined to confirm whether a probe has begun. Florida was one of the states hit hardest by a collapse of the U.S. housing market, which triggered the deepest recession in decades. Nelson also alleged that Florida, where the state government is run by Republican Governor Rick Scott, spent some of the state's share of the funding on people who "never should have gotten it." A spokesperson for the Florida Housing Financing Corp, the state agency that oversees the fund's use in Florida, did not immediately respond to a request for comment. SIGTARP last year criticized federal agencies for implementing the "Hardest Hit Fund" at a slow pace, allocating just a fraction of what it had been allotted. The program was suffering from big delays due to a lack of planning by the Treasury Department and slow implementation by government-controlled housing finance companies Freddie Mac and Fannie Mae, the watchdog said in a report released in April 2012. Link this Share this Digg this Email Reprints

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