WASHINGTON, DC - Congress today gave its stamp of approval to an anti-foreclosure bill that includes U.S. Senator Jack Reed's (D-RI) legislation to protect and reimburse taxpayers who made significant investments in the financial system through the Troubled Asset Relief Program (TARP) program. Both the U.S House of Representatives and the U.S. Senate today approved Reed's warrants amendment giving the U.S. Treasury the right to purchase common stock at a later date so taxpayers can receive more of a return on their investment when the banking industry recovers. According to academic experts cited by the New York Times, Reed's warrants provision could help taxpayers recoup up to $10.9 billion of their investment in the TARP program.

In September of 2008, Reed authored legislation giving the federal government warrants to purchase stock in companies that participated in the bailout plan, so that taxpayers might be able to profit should the firms flourish after selling their bad debts to the government. However, now that banks are seeking to re-pay TARP funds far sooner than expected, Reed's legislation reverses the current policy that effectively lets the banks determine the value of the warrants at win for the banks and instead gives the Secretary of the Treasury, not the banks, the choice of when to exercise the warrants based on what is best for the taxpayers.

"I am pleased that Congress passed this critical legislation. This is a timely and important tool that will strengthen Treasury's ability to recoup some of the taxpayer investment," said Reed, a senior member of the Banking Committee. "Taxpayers assumed all the risk, as the banking industry recovers it is only fair that taxpayers share in the recovery."

Reed's amendment removes the program's requirement that Treasury liquidate the warrants after a TARP recipient repays the government and gives the Secretary of the Treasury discretion to dispose of those warrants when he feels it is appropriate.

"I believe the Secretary should have the discretion to hold these warrants if he thinks it is in the best interests of the taxpayers. I urge Secretary Geithner to use this provision to ensure value for taxpayers," stated Reed.

Reed's amendment was included as a key part of the Helping Families Save Their Homes Act, which now goes to President Obama's desk to be signed into law.