WASHINGTON ( TheStreet) -- Citigroup ( C) CEO Vikram Pandit's testimony to a congressional panel today about the $45 billion taxpayer bailout that kept his bank alive should raise questions about the government's conflicted role as both investor and regulator.

Pandit told the panel that Citigroup's efforts to exit the bailout have been a success so far, and over at the Treasury they are saying they could sell the Citi stake profitably in current market conditions.

Well that's been true for more than six months, so why is the government still Citi's biggest shareholder?

At current valuations, the government would earn a $1.15 billion profit. On top of that unrealized gain, the U.S. government has received more than $3 billion in dividends from Citi.

So if the government is worried about Citi's stability, Pandit is suggesting that everything is under control now.

If it's about recouping taxpayer money, then look at this chart of Citigroup's share price and ask yourself why the government didn't sell its 27% stake months ago.

A sale in October would have brought taxpayers a $13.4 billion windfall.

When the stock hit $5, the sell order should have been made. The profit should have been locked in and the government should have exited from this uncomfortable public ownership of private enterprise.

So now that Pandit has said his piece today and duly thanked the government for all its help, I hope the congressional panel will start asking why the government still owns a stake in Citi?

--Written by Glenn Hall in New York.

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