Free Republic

““SEC. 1338. Housing Trust Fund. “(a) Establishment and purpose.—The Secretary of Housing and Urban Development (in this section referred to as the ‘Secretary’) shall establish and manage a Housing Trust Fund, which shall be funded with amounts allocated by the enterprises under section 1337 and any amounts as are or may be appropriated, transferred, or credited to such Housing Trust Fund under any other provisions of law. The purpose of the Housing Trust Fund under this section is to provide grants to States for use— “(1) to increase and preserve the supply of rental housing for extremely low- and...

Why isn't TV news giving the Fannie Mae scandals the same level of coverage that it gave to Enron? Fannie Mae, the government-sponsored mortgage association, has been battling a mounting scandal since last year. It has accounting errors of about $11 billion. That's more than 19 times larger than Enron's $567 million error. Fannie faces a Justice Department inquiry, an SEC investigation and an Office of Federal Housing Enterprise complaint. The mess has caused the departure of CEO Franklin Raines and several other top executives. And Fannie Mae stock has dropped roughly 30 percent, from nearly $80 a share to...

WASHINGTON, Dec. 16 - Fannie Mae, the housing-finance giant, for years has fended off critics who contend that the company is too big, too powerful and too risky. But the Securities and Exchange Commission's Wednesday ruling, that Fannie Mae had seriously breached accounting rules, could touch off a chain reaction that results in stricter government controls, legislation limiting its growth and possibly even a change in top management. Democratic and Republican lawmakers alike demanded on Thursday that senior executives, including the chief executive, Franklin D. Raines, return tens of millions of dollars in bonuses and other compensation that they had...

...Here's a case of misplaced moral outrage if we've ever seen one. Mr. Franks is mad about the salaries when he really should be mad at the rigged political game that has made them possible. Fannie's regulator, the Office of Federal Housing Enterprise Oversight, has reported that Fannie has been cooking its books. Add that to the increasing evidence that Fannie has been ignoring its mission to provide affordable housing, and we wonder if Mr. Frank doesn't need an eye checkup.... Maxine Waters (D., California) cooed all over Mr. Raines, and Clay Lacy (D., Missouri) played the race card by...

For years, mortgage giant Fannie Mae has produced smoothly growing earnings. And for years, observers have wondered how Fannie could manage its inherently risky portfolio without a whiff of volatility.... The magnitude of Fannie's machinations is stunning, and in two key areas in particular they deserve to be better understood. By improperly delaying the recognition of income, it created a cookie jar of reserves.... Lower rates caused a lot of mortgage holders to prepay their existing home mortgages. And Fannie was suddenly facing an estimated expense of $400 million. Well, in its wisdom, Fannie decided to recognize only $200 million,...