By Peter Schroeder - 03/17/11 09:37 PM EDT
Rep. Barney Frank (D-Mass.) wants hedge funds and major financial institutions to foot the bill for housing relief programs, under a new bill he introduced Thursday.
The ranking member of the House Financial Services Committee unveiled legislation that would direct the Treasury Department to tap Wall Street for billions. Under the Emergency Mortgage Relief and Neighborhood Stabilization Program Cost Recoupment Act of 2011, the Treasury would claim $2.5 billion from hedge funds with over $10 billion in assets and other financial companies with $50 billion or more.
Frank announced last week on the House floor that such a bill would be forthcoming, arguing that large financial institutions can afford to pay for mortgage assistance programs.
"I don't mean to demonize, but I think Goldman Sachs and Wells Fargo and the Bank of America and Citicorp and Morgan Stanley and the large hedge funds, I think they can pay for this," he said March 11.
The bill comes as House Republicans are pushing to shutter several housing programs, arguing they are costly and ineffective. The House has passed three bills thus far, each that would eliminate one program. A fourth bill, one that would kill the Home Affordable Modification Program (HAMP) is slated for consideration once Congress returns from a weeklong recess. President Obama has threatened to veto each of the bills.