The $700bn bail-out of the US banking system is being carried out without adequate oversight, according to the Government Accountability Office (GAO).

The Congressional watchdog says that the US Treasury is failing to monitor whether banks have complied with requirements on executive pay.

At that time, US Treasury Secretary Henry Paulson said that the $700bn would be used to buy up troubled mortgage assets from the banks.

But shortly afterwards, he decided that the money would be better spent by providing additional capital directly to the banks.

So far, over $150bn has been invested by government in the purchase of preferred shares, including taking a $115bn stake in eight major national banks, and smaller stakes in 44 other banks.

The Treasury’s said its objective was to stabilise the financial system and increase the flow of funds for lending.

But the GAO report says that the Treasury “has no policies or procedures in place for ensuring the institutions… are using the capital investments in a manner that helps meet the purposes of the act.”

So basically, Paulson and the gang can do whatever they want to do with the cash–is this such a good idea?  Once again just goes to illustrate that White collars are more preferable to blue collars.  Congress has got the employers of blue collars jumping through their butts to get some help and yet the white collars just ask and they receive…so you decide who is important to politicians.