Fannie & Freddie free from oversight

California Attorney General Kamala Harris is asking the court to force Fannie Mae and Freddie Mac to turn over information about their servicing, foreclosure, property leasing, and mortgage securitization activities in the state. Harris issued subpoenas to each of the GSEs last month, which according to the Los Angeles Times, outlined 51 questions the attorney general wanted answered – just one facet of Harris’ investigation to ascertain the extent to which mortgage lenders and servicers contributed to the state’s foreclosure and housing crisis. According to multiple media reports, Harris’ lawsuits against the two GSEs, filed Tuesday in California Superior Court in San Francisco, claim Fannie and Freddie have refused to comply with the subpoenas.

 

Harris maintains the GSEs are “frustrating the Attorney General’s efforts to investigate and combat crime, blight and other threats to the health and safety of Californians.” Fannie and Freddie’s regulator, the Federal Housing Finance Agency (FHFA), had reportedly instructed the two mortgage financiers not to respond to Harris’ initial subpoenas on the grounds that states do not have the authority to take such action against the federally controlled GSEs.

 

This was the same position the banking commissioners held when Countrywide Mortgage was being investigated by Elliott Spitzer back in 2007 before the mortgage crisis hit. It should be clear to all Americans that these institutions will never be held accountable. It’s big business as usual even after everything that’s happened since 2008.

 

Attorneys for FHFA described Harris’ request for information as “frequently vague and ambiguous” and one that would place a burden “nothing short of staggering” on the GSEs in order to gather the details she’s demanding, according to the Associated Press. Harris wants Fannie and Freddie to identify all the California homes on which they foreclosed, as well as whether or not any were used for drug dealing or prostitution and the impact such activity had on the property’s value.

The attorney general’s office also plans to look into the history of tax payment on the properties, evictions involving military families, and the GSEs’ actions related to the purchasing, packaging, and re-selling of so-called toxic mortgages.

 

While California Attorney General Kamala Harris is asking for a lot and obviously difficult data to gather, it still shows that these organizations operate with no guidelines and all Americans need to be aware of it. There are extremists who are ready to stop paying their mortgage and defend their home by gunpoint until the corporate crime in the country stops…I used to think they were crazy, but now I’m not so sure. Draw your own conclusions people.

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