December 23, 2009
Attorney General of the United States of America
U.S. Department of Justice
950 Pennsylvania Avenue, NW
Washington, DC 20530-0001
Dear Attorney General Holder:
We write to demand an immediate investigation into the activities of (then-) White House Chief of Staff Rahm Emanuel. We believe there is an abundant public record which establishes that the actions of the Obama White House have blocked any investigation into his activities while on the board of Freddie Mac from 2000-2001, and facilitated the cover up of potential malfeasance until the 10-year statute of limitations has run out.
The purpose of this letter is to connect the dots to establish both the conduct of Mr. Emanuel and those working with him to thwart inquiry, and to support your acting speedily so that the statute of limitations does not run out before the Justice Department is able to empanel a grand jury.
The New York Times reports that the Obama administration is negotiating to double the commitments to Fannie and Freddie for a total of $800 billion by December 31, in order to avoid the congressional approval that would be needed after that date. But there currently is no Inspector General exercising independent oversight of these entities. Acting Inspector General Ed Kelly was stripped of his authority earlier this year by the Justice Department, relying on a loophole in a bill Mr. Emanuel cosponsored and pushed through Congress shortly before he left for the Obama White House. This effectively ended Mr. Kelly’s investigation into what happened at Fannie and Freddie.
Since that time, despite multiple warnings by Congress that having no independent Inspector General for a federal agency that oversees $6 trillion in mortgages is a serious oversight, the Obama White House has not appointed one.
We recognize that these are extremely serious accusations, but the stonewalling by Mr. Emanuel and the Obama White House has left us with no other redress. A 2003 report by Freddie Mac’s regulator indicated that Freddie Mac executives had informed the board of their intention to misstate the earnings to insure their own bonuses during the time Mr. Emanuel was a director (as an appointee of the Clinton administration). But the Obama White House refused to comply with a Freedom of Information Act request from the Chicago Tribune for those board minutes on the grounds that Freddie Mac was a “commercial” entity, even though it was wholly owned by the government at the time the request was made.
If the Treasury approves the $800 billion commitment to Fannie and Freddie by the end of the year, it will mean that under the influence of Rahm Emanuel, the Obama White House is moving a trillion-dollar slush fund into corruption-riddled companies with no oversight in place. This will allow Fannie and Freddie to continue to purchase more toxic assets from banks, acting as a back-door increase of the TARP without congressional approval.
Before the Obama White House commits any more money to Fannie and Freddie, we call on the Public Integrity Section in the Justice Department to begin an investigation into the cause of Fannie and Freddie’s conservatorship, into Rahm Emanuel’s activities on the board of Freddie Mac (as a Clinton appointee) including any violations of his fiduciary duties to shareholders, into the decision-making behind the continued vacancy of Fannie and Freddie’s Inspector General post, and into potential public corruption by Rahm Emanuel in connection with his time in Congress, in the Obama White House, and on the board of Freddie Mac.
We also call for the immediate appointment of an Inspector General with a complete remit to go after this information.
Signers of this letter come from differing political ideologies. One, the conservative head of a transparency foundation, the other, publisher of a liberal political blog. But we make common cause today out of grave concern for the future of our country in the wake of corruption-riddled bailouts.
These bailouts continue to rob Main Street to benefit Wall Street, and, because of that, we together demand the resignation of Mr. Emanuel, a man who has steadfastly worked to obstruct both oversight and inquiry into the matter. Rahm Emanuel’s conflicts of interest render him far too compromised to serve as gatekeeper to the President of the United States. We will lay out the details further below, and are available at your earliest convenience to meet with you directly.
Sincerely,
Jane Hamsher
Grover Norquist
ANGELO MOZILO Then-chairman and chief executive of Countrywide Financial. The biggest American sub-prime mortgage lender, was a step away from bankruptcy when Bank of America paid billions to settle investigations by various attorney generals for Countrywide's mis-selling of risky loans to thousands who could not afford them.
Mozilo ran a "VIP programme" that provided loans on favourable terms to influential figures including Christopher Dodd, chairman of the Senate banking committee, the heads of the federal-backed mortgage lenders Fannie Mae and Freddie Mac (that taxpayers were forced to bailout) , and former assistant secretary of state Richard Holbrooke (now in Obama's admin).
SEN CHRIS DODD Since June, Sen Chris Dodd (D-Conn) has faced an ethics inquiry over allegations that he received preferential treatment on two mortgages in 2003 from Countrywide Financial. And then came the dramatic financial meltdown last month, placing Dodd at the center of a controversial $700 billion financial rescue plan.
As a member and later chairman of the Senate Banking Committee, Sen. Dodd shoulders a good deal of the blame for the collapse of the national housing market, the subprime-mortgage-market meltdown and the convulsions on Wall Street which is costing taxpayers billions.
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http://www.guardian.co.uk/business/2009/jan/26/road-ruin-recession-individuals-economy