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A Project of The Annenberg Public Policy Center

DCCC Calls Latham Out on TARP

A Democratic robocall in Iowa accuses GOP Rep. Tom Latham of “looking out for himself” by profiting from legislation he actually opposed.

The Des Moines Register reports that the call from the Democratic Congressional Campaign Committee charges Latham with “only looking out for himself, not the middle class,” for having stock in a bank holding company that took Troubled Asset Relief Program funds in 2009.

The problem with that claim is that Latham actually voted against the Emergency Economic Stabilization Act that created TARP back in 2008. Furthermore, bank officials told the paper that Latham had no involvement in the company’s decision to take TARP funding.

The following is a transcript of the DCCC’s robocall:

DCCC’s Latham Robocall Script: “Hi, this is XXX from the DCCC calling with a warning. Congressman Tom Latham is not telling you the whole truth. He criticizes the banks that received taxpayer bailouts, but what he’s not telling you is that he had over $1 million invested in a bank that received TARP funds. Congressman Latham even used to be a director of the bank and three of his brothers currently sit on the board of directors.

That’s right – Congressman Latham is profiting off of taxpayer dollars! To make matters worse, his bank is one of only three banks in Iowa that hasn’t paid back the government for their TARP loans. Congressman Tom Latham benefited personally from TARP even though he says he opposed it because he’s only looking out for himself, not the middle class.

Call Congressman Tom Latham at 515-232-2885 and tell him to come clean about profiting off of taxpayer dollars.”

It is true that Latham has stock in Green Circle Investments, the holding company for Iowa’s Peoples Trust & Savings Bank. Latham’s 2011 congressional financial disclosure form states that his assets include $1 million to $5 million through Green Circle Investments, which received $2.4 million in TARP funds in 2009. The company has paid the government $355,340 in dividends in connection with the loan, but has yet to repay any of the principal on the loan, according to a June 30 story in the Register.

It is also true that Latham used to be a director with the company, but that was long before he voted against the legislation creating TARP in 2008. Campaign aides for Latham confirmed to the Register that Latham was once a director at the company, but said that he resigned before he was first elected to Congress nearly 18 years ago.

(FactCheck.org verified that Latham was not listed as a director of Green Circle Investments on any of his financial disclosure forms going back to 1995, as would have been required under law.)

And while the company’s current board of directors does include members of Latham’s family, they deny that the congressman had a role in the company’s decision to take TARP funding:

Des Moines Register, June 30: Green Circle has about 30 investors, said Bob Latham, chairman of Peoples Trust. Green Circle acquired Peoples bank in 1991 after purchasing Loof Investment Co.

Tom Latham resigned as a director of Green Circle a few years later when he first ran for Congress and has not had a management role since, Bob Latham said.

Tom Latham was not consulted about the decision to accept TARP funds, Bob Latham said.

“I never discussed this with Tom,” Bob Latham said. “At the time we discussed entering into TARP, we did not consult with any of our owners individually. It was strictly a board decision to proceed.”

The company, which today has assets of $258.6 million, accepted the $2.4 million in federal money “basically as an insurance policy,” Bob Latham said. “We didn’t want to do anything to jeopardize the deposits or the bank itself.”

The bank’s CEO, Mike Segner, said he wasn’t aware of any involvement by Tom Latham in the decision to accept TARP funding. He said he believes the program has worked for the bank.

In a statement addressing his 2008 vote against TARP, Latham asked: “[I]s it morally right to spend hundreds of billions of dollars to reward and benefit those on Wall Street who were knowingly involved in risky and, sometimes, exotic financial investments that were hidden from the eyes of federal regulators? Why is Washington so quick to focus on the needs of Wall Street at the cost of those responsible Iowans who have sacrificed, saved, and spent within their means?”

Latham is running against Democratic Rep. Leonard Boswell this fall in a matchup of incumbents created by the reconfiguring of Iowa’s 3rd Congressional District. Boswell voted for the legislation that created TARP nearly four years ago.

— D’Angelo Gore