RTC Asset Management:
Contracting Controls Need to Be Strengthened
T-GGD-90-53: Published: Sep 24, 1990. Publicly Released: Sep 24, 1990.
- Full Report:
GAO discussed the Resolution Trust Corporation's (RTC) contracting practices. GAO noted that: (1) in January 1990, GAO cited RTC as 1 of 14 federal programs that were highly vulnerable to fraud, waste, and abuse; and (2) as of June 30, 1990, RTC resolved 207 thrifts and controlled $168 billion in assets, including 40,000 properties with a book value of about $16 billion. GAO also noted that RTC reliance on contractors to carry out a major portion of its mission made it essential that RTC have: (1) an appropriate organizational structure for selecting contractors and monitoring performance; (2) sufficient numbers of competent personnel to award and monitor contracts; and (3) an internal control system to safeguard assets against waste, loss, unauthorized use, and misappropriation. In addition, GAO noted that RTC: (1) developed a highly decentralized organizational structure with delegations of authority; (2) established a task force to assess contracting staff training needs; (3) developed such essential controls as rules on ethical standards, a standard asset management and disposition agreement, and an asset management and disposition manual; and (4) needs to watch out for problems resulting from not calculating net proceeds from assets, difficulty in defining good performance measures, and insufficient management information.