Did Bailed Out Banks Trick Congress?

Is it the old -- expensive -- switcheroo? Might some of the bailed out banks not actually be using the $700 billion taxpayers gave them the way they told Congress they would?

On October 29, House Judiciary Committee Chairman John Conyers, Jr. (D-Michigan) and Government Oversight Subcommittee Chairman Dennis Kucinich (D-Ohio), bristled at reports indicating that the bailed-out banks intended to use the taxpayer money to buy out smaller banks, rather than for making loans.

"It is very troubling to learn that the $700 billion rescue package sold to the American consumer as necessary to continue loans to small businesses and consumers, is apparently being used instead to squeeze smaller banks out of the market;" said Conyers in a press release. "I’m concerned about the federal government using these funds to take sides in mergers and to promote consolidation within the financial markets instead of reviving our economy."

As an example, Rep. Kucinich noted a recent case in his home district resulting in a bank that did not receive bailout money being purchased by a bank that did. "Federal money should not be used to subsidize consolidation of the banking industry," he said.

Also See:
Bill Would End Bonuses for Bailed-Out Bankers
Waxman Demands Banks Disclose Bonuses
Federal Intervention in the Banking Panic (US Economy)