CONGRESS IN BONUS HUNT AT FANNIE MAE (knowingly cooked the books to get huge bonuses?)

NY POST ^ | 1/6/05 | RICHARD WILNER

[Liz]

A powerful Washington lawmaker wants Franklin Raines and other former and current Fannie Mae executives to fork over the more than $18 million in bonuses they got over three years if fraudulently inflated profits led to the payout.

Raines and Timothy Howard were given the boot four days before Christmas after the Securities and Exchange Commission ruled the company wrongly applied some accounting rules that inflated profits from 2001-2004........may lead to a $9 billion restatement of profits over that period.

The bonuses — including $10.6 million to Raines — were tied to Fannie Mae hitting certain profit targets.

The Department of Justice is investigating whether Raines, Howard and others knowingly misapplied the accounting rules in order to get the huge bonuses.

[Liz]

We can assume this exercise does not include the tens of millions these clever cons were able to secrete out of Fannie Mae into offshore banks.

[spodefly]

The odds that there will be any repercussions for Raines, Gorelick, et al, are similar to the odds that Sandy Berger will be prosecuted for removing documents from the National Archive.

[Liz]

Federal regulator Office of Federal Housing Enterprise Oversight, Sept, 2004 released a damning report on accounting irregularities at Fannie Mae, that in 1998, Fannie misstated expenses in order to meet earnings targets that triggered huge executive bonuses.

1998 Salary and Bonus of Senior Fannie Mae Executives

James A. Johnson Chairman and CEO $966,000 $1,932,000
Franklin D. Raines Chairman and CEO Designate $526,154 $1,109,589
Lawrence M. Small President and COO $783,839 $1,108,259
Jamie Gorelick Vice-Chairman $567,000 $779,625
J. Timothy Howard EVP and CFO $395,000 $493,750

[calcowgirl]

They should pay it back... with interest :-)

[LibertarianInExile]

1998? Who was president then? Shouldn't they have done something about this travesty?

[Liz]

WJC was probably in on the deals deposited in offshore banks.

[Jimmy Valentine]

Never mind that. Just try base salary and their stock options.

Regards,

[Coldwater Creek]

Here in Memphis, Black politicians do this sort of thing all of the time. And they get reelected over and over.

[mewzilla]

Fannie Mae and Oil For Food...

Gee, is there a pattern here?

[Liz]

Fannie Mae and Oil For Food...

If it happened during Clinton's interregnum, it's all connected.

[mewzilla]

Not to mention they share the same MO. Wonder what else was looted?

[gitmo]

Isn't Fannie Mae subject to the same accounting laws the rest of us are? If so, why aren't there criminal charges being filed?

[Liz]

We need to get these politically-connected suckups to be subject to the same laws we all must obey.

Fannie Mae's board approved Raine's outrageous payout package. Let's shine some light on these people. Their names should be in every article printed about this scandal. Their actions make me think that they are helping cover up even more scandalous behavior by buying off this criminal. We will also report them and their companies to the SEC. Fannie Mae's Board Members' Enron-style accounting practices, and their fiscal irresponsibility, will be of interest to the SEC at this link:

enforcement@SEC.gov

---

FROM FANNIE MAE WEBSITE Fannie Mae has long combined excellent financial success with social responsibility. We fulfill our unique public mission through a strong management team. The day-to-day management of Fannie Mae and our approximately 5,055 employees is conducted by the corporation's officers, headed by the Interim Chief Executive Officer, and the Interim Chief Financial Officer. In 2004, the Administration declined to reappoint or replace the Presidential appointees to Fannie Mae's Board. Pursuant to current Charter Act provisions, those five Board positions will remain open unless and until the President names new appointees. To access any board member's biography, click on the Director's name.

FANNIE MAE BOARD MEMBERS

Stephen B. Ashley
Non-Executive Chairman of the Board, Fannie Mae
Chairman & Chief Executive Officer,
The Ashley Group
A group of commercial and multifamily real estate companies
Rochester, NY
Board member since 1995

Kenneth M. Duberstein
Chairman & Chief Executive Officer,
The Duberstein Group, Inc.
A strategic planning and consulting company
Washington, DC
Board member since 1998
Material relationship with Fannie Mae


Thomas P. Gerrity
Professor of Management,
The Wharton School
University of Pennsylvania
An educational institution
Philadelphia, PA
Board member since 1991

J. Timothy Howard
Resigned from Fannie Mae Board effective January 31, 2005



Ann Korologos
Lead Director, Fannie Mae
Vice Chairman, RAND Board of Trustees
A nonprofit organization
Washington, DC
Board member since 1994

Frederic V. Malek
Chairman,
Thayer Capital Partners
A private equity investment firm
Washington, DC
Board member since 2002


Donald B. Marron
Chairman & Chief Executive Officer,
Lightyear Capital
A private equity investment firm
New York, NY
Board member since 2001

Daniel H. Mudd
Vice Chairman & Interim Chief Executive Officer
Board member since 2000



Joe K. Pickett
Former Chairman & Chief Executive Officer,
HomeSide International Inc.
A mortgage banking company
Jacksonville, FL
Board member since 1996

Leslie Rahl
President & Founder
Capital Market Risk Advisors, Inc.
A financial advisory firm
New York, NY
Board member since 2004


H. Patrick Swygert
President,
Howard University
An educational institution
Washington, DC
Board member since 2000

John K. Wulff
Chairman of the Board,
Hercules Incorporated
A manufacturing company
Wilmington, DE
Board member since 2004



Last Revised: December 30, 2004





FANNIE MAE URL

http://www.fanniemae.com/governance/board/index.jhtml?p=Corporate+Governance&s=Board+of+Directors

_____________________________________________


EMAIL your complaints about Fannie Mae's Board Members' Enron-style accounting practices, and fiscal irresponsibility at this link:

enforcement@SEC.gov

[sevry]

The whole of Fannie Mae, looking at those directors, and Raines, seems like a real Democrat backwater, a lil liberal club.

But Raines didn't just get 18 million - that's million. His 'package', his 'packet', his 'packing packet of packaging' was full of million-dollar components, such that he walked away with perhaps over one hundred million or more, if I'm not mistaken. Just various parts of his 'packaging package' are more than superstar NBA players get in their big rookie contracts. This is what I think so many want to cover up, just how rich this do-nothing lib got while people struggle to pay the bills, and pay their taxes. And this fool just gets millions and millions and millions thrown at him like it was just paper, and just grew on trees everywhere.

[Liz]

Fired for bungling its books....Raines gets a $26 million parachute — not counting a monthly pension of $116,300 for life. owns options giving him $5.8 million in net profit plus another $8.7 million in deferred compensation......has already collected $4.87 million in special performance shares....keeps $5 million paid-up life insurance. Mr/Mrs get free med/dental benefits for life, worth over $1 million. Raines earned $20 million in salary, bonuses and stock awards last year ......says he's entitled to paychecks til next June 22 adding another $600,000, which triggers a $2,000 monthly raise in his lifetime pension......also lays claim to disputed options with a gross value of about $5.6 million ......wants F/M to match his charitable contributions by $10,000 a year.

[MamaLucci]

The whole of Fannie Mae, looking at those directors, and Raines, seems like a real Democrat backwater, a lil liberal club.

Except for Ken Duberstein........he was President Reagan's Chief of Staff.

[sevry]

$26 million

I thought it was a LOT more than that.

earned $20 million

Earned, is a pretty strong word. Granted. Grifted, is probably more accurate.

Mr/Mrs get free med/dental benefits for life, worth over $1 million.

If either or both require extensive care, particularly ICU, I can tell you that hospitals LOVE to charge, and love to charge more. One million wouldn't get you very far. But free, without any limit on payout - that would be some freebie benefit indeed. Five weeks ICU, 10 MRIs, every test imaginable, transpo to and from, live-in nurses with complete in-home facilities, etc.

It's really just not right. The man messed up, and messed up very badly on his job. He shouldn't be rewarded like a king for that.

[MeekOneGOP]

That's some list you've got there.

Jamie Gorelick Vice-Chairman $567,000 $779,625

Thomas Kean says I am the most non-partisan, bi-partisan member of the 911 Commission. Well, ain't I SPECIAL !?

[Liz]

Raines and company didn't just mess up.....they deliberately cooked the books so they could cash in to get those mega-bonuses.

And you are right......the payout to Raines adds up to about $120M....all tolled.

[philman_36]

And all of this should lead to the popping of the over inflated housing bubble which, like the stock market, is in dire need of a market readjustment. Pop it and start again.