News Summary: Watchdog says US may lose $27B

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Associated Press

Posted on January 30, 2013 at 2:02 AM

Updated Wednesday, Jan 30 at 2:02 AM

LOSSES FROM BAILOUT: A government watchdog says U.S. taxpayers stand to lose $27 billion from the 2008 financial bailout, up from an estimate of $22 billion in the fall.

ALLY OWES: Ally Financial Inc., the former financial arm of General Motors, still owes $14.6 billion of the $17.2 billion in aid it received. The watchdog report says taxpayers can expect to lose $5.5 billion on that investment because of the company's losses on risky mortgages issued ahead of the financial crisis. Taxpayers own 74 percent of the company.

CRITICISM OF TREASURY: The report also said the Treasury Department lacks a plan to unwind its investment in Ally. Treasury says it has an exit strategy.

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