The Treasury Department lacks oversight of legal fees related to the Troubled Asset Relief Program that could lead to overpayment.
A report by the Special Inspector General for TARP found Treasury’s Office of Financial Stability paid legal bills to Venable LLC law firm without questioning bills that were vague and had administrative charges not allowed under the contract.
In all, SIGTARP reviewed contracts with five law firms worth a total of more than $27 million in legal fees.
“OFS’ current practices create an unacceptable risk that Treasury, and therefore the American taxpayer, is overpaying for legal services,” according to the report. “OFS should immediately provide its outside attorneys specific directions on how to prepare fee bills and how to describe discrete tasks within each fee bill.”
Under Federal Acquisition Regulation guidelines, “appropriate government surveillance” is required of a contractor’s performance.
Among the weaknesses in the billing were block billing – billing a single amount for several tasks. SIGTARP also found inadequate descriptions of work. These ambiguities should have been questioned by OFS, the report said.