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US President to Big Banks: 'We Want Our Money Back'

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U.S. President Barack Obama is calling on the country's top banks to take responsibility for their role in the global financial crisis and repay the financial industry bailout in full.

The president Thursday said it was unacceptable for American taxpayers to lose any money when many financial firms are now reporting "massive profits" and giving top executives, in his words, "obscene bonuses."

He said many of the firms would not have survived without government help.

Mr. Obama is proposing a "financial crisis responsibility fee" for about 50 of the country's largest banks and financial firms, including some that did not get government help during the crisis.

He said it would raise $90 billion over the next 10 years, and that it would remain in place until all of the bailout money has been paid back.

The United States set up a $700-billion program in late 2008, known as TARP, to assist financial firms in danger of collapsing because of the financial crisis.  While many top U.S. banks have already repaid the government, officials say with the fee, the program could still lose $170 billion.

But some top bank officials are already criticizing the fee.

JPMorgan Chase Chief Executive Jamie Dimon called it "a bad idea," warning that businesses tend to pass additional costs onto their customers.

President Obama criticized complaints from the banking industry, saying their insistence that it was fairer for taxpayers to fund the total cost of the financial industry bailout was "twisted logic."

The proposed fee is being included in President Obama's proposed budget and will have to be approved by lawmakers.

Meanwhile, one day after questioning top bankers, the bipartisan panel created by Congress to investigate the causes of the financial crisis heard from top government regulators.

U.S. Attorney General Eric Holder told the Financial Crisis Inquiry Commission Thursday that he would use every tool at his disposal to crack down on investment fraud.

Federal Deposit Insurance Corporation Chairman Sheila Bair admitted regulators failed to do enough, but also criticized the U.S. central bank for failing to use its powers effectively.

The Federal Reserve Thursday urged key lawmakers not to strip it of its authority to supervise banks.

Chairman Ben Bernanke said in a letter to the U.S. Senate Banking Committee, that reducing its powers would deprive the Fed of information it needs to set monetary policy.
 

Some information for this report was provided by AP, Bloomberg and Reuters.

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