You might think that with financial luminaries like Hank Paulson (former Goldman Sachs CEO) in charge of the Treasury Department, the government would need little outside help in determining how best to allocate bailout funds. Yet from October through January, the Troubled Asset Relief Program (TARP) paid $39.7 million in administrative costs to 7 Law firms and 2 financial institutions, mostly for providing advice on buying distressed assets. $26.6 million of that was paid in January alone (PDF) (see page 6), and the Treasury has given no indication of why spending has skyrocketed, or where exactly the money is going. In the public facsimile (PDF) of the Treasury’s agreement with Bank of New York Mellon Corp, Paulson’s designated master custodian for the $700 billion of TARP funds, the lines denoting the amount of management fees paid to the bank have been redacted (see page 25). Management fees are usually calculated as a percentage of assets under management; if Mellon charged its usual quarterly rate of 0.078%, it would reap $537 million in management fees. The Bank also happens to be the recipient of $2 billion in taxpayer funds as part of TARP’s injection of $250 billion into banks. It would appear that Mr. Paulson has received his wish, expressed in his original plan for the bailout: “Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.”