Buffett: Wells Was Forced to Repay TARP

Updated with response from Wells Fargo spokesperson.

NEW YORK (TheStreet) -- Warren Buffett divulged another instance of heavy-handed government intervention into the banking industry, saying that regulators "forced" Wells Fargo (WFC) to issue new stock to pay back bailout funds.

In an interview with CNBC on Wednesday, Buffett was asked how he felt about Wells having raised $12.25 billion through a stock offering last month to repay $25 billion from the Troubled Asset Relief Program.

"I didn't like it," said Buffett, whose Berkshire Hathaway (BRK.A) is a major holder of Wells Fargo stock. "I mean, the government forced them to issue the shares."

A Wells Fargo spokeswoman said the bank would not comment on Buffett's remarks. The Treasury Department didn't immediately respond to requests for comment.

Both the Obama and Bush administrations have been criticized for their handling of various aspects of the bank bailout program, starting with its inception.

Executives from the handful of banks that initially received TARP funds have said they were required to do so after being handed contracts at a conference table by Former Treasury Secretary Henry Paulson. Executives from Wells Fargo, JPMorgan Chase (JPM) and Goldman Sachs (GS) have indicated that their banks didn't actually need the funds and could have survived without a bailout.

Paulson and Federal Reserve Chairman Ben Bernanke were caught in another scandal involving Bank of America's (BAC) acquisition of Merrill Lynch. Bank of America's former CEO Ken Lewis had considered invoking a contractual clause to walk away from the deal, but opted not to after facing pressure from the Treasury and Fed leaders.

Under Obama's watch, executive pay has become a sticking point, with a pay czar micromanaging compensation packages at firms that received the most support. As a result, at least one American International Group (AIG) executive has left the insurer, and its CEO has reportedly threatened to quit as well. Citigroup (C) and Bank of America both raced to repay TARP before the end of the year to escape the compensation crackdown they otherwise would have faced.