Who and where are the former Fannie Mae Executives who ran Fannie Mae and Freddie Mac into the ground and precipitated the bailout?
Here is a quick look into 3 former Fannie Mae executives who have brought
down Wall Street.
Franklin Raines was Chairman and Chief Executive Officer at Fannie Mae.
Raines was forced to retire from his position with Fannie Mae when
auditing discovered severe irregulaties in Fannie Mae's accounting
activities. At the time of his departure The Wall Street Journal noted, "
Raines, who long defended the company's accounting despite mounting
evidence that it wasn't proper, issued a statement late Tuesday conceding
that "mistakes were made" and saying he would assume responsibility as he
had earlier promised. News reports indicate the company was under growing
pressure from regulators to shake up its management in the wake of
findings that the company's books ran afoul of generally accepted
accountin g principles for four years." Fannie Mae had to reduce its
surplus by $9 billion.
Raines left with a "golden parachute valued at $240 Million in benefits.
The Government filed suit against Raines when the depth of the accounting
scandal became clear.
DoomWatch - Former Fannie Mae Executives Charged | Housing Doom . The Government noted, "The 101 charges reveal how the individuals improperly manipulated earnings to maximize their bonuses, while
knowingly neglecting accounting systems and internal controls,
misapplying over twenty accounting principles and misleading the
regulator and the public. The Notice explains how they submitted six
years of misleading and inaccurate accounting statements and inaccurate
capital reports that enabled them to grow Fannie Mae in an unsafe and
unsound manner." These charges were made in 2006. The Court ordered
Raines to return $50 Million Dollars he received in bonuses based on the
mis-stated Fannie Mae profits.
Tim Howard - Was the Chief Financial Officer of Fannie Mae. Howard "was
a strong internal proponent of using accounting strategies that would
ensure a "stable pattern of earnings" at Fannie. In everyday English - he
was cooking the books.. The Government Investigation determined that,
"Chief Financial Officer, Tim Howard, failed to provide adequate
oversight to key control and reporting functions within Fannie Mae,"
On June 16, 2006, Rep. Richard Baker, R-La.., asked the Justice
Department to investigate his allegations that two former Fannie Mae
executives lied to Congress in October 2004 when they denied manipulating
the mortgage-finance giant's income statement to achieve management pay
bonuses. Investigations by federal regulators and the company's board of
directors since concluded that management did manipulate 1998 earnings to
trigger bonuses. Raines and Howard resigned under pressure in late 2004.
Howard's Golden Parachute was estimated at $20 Million!
Jim Johnson - A former executive at Lehman Brothers and who was later
forced from his position as Fannie Mae CEO. A look at the Office of
Federal Housing Enterprise Oversight's May 2006 report on mismanagement
and corruption inside Fannie Mae, and you'll see some interesting things
about Johnson. Investigators found that Fannie Mae had hidden a
substantial amount of Johnson's 1998 compensation from the public,
reporting that it was between $6 million and $7 million when it fact it
was $21 million." Johnson is currently under investigation for taking
illegal loans from Countrywide while serving as CEO of Fannie Mae.
Johnson's Golden Parachute was estimated at $28 Million.
WHERE ARE THEY NOW?
FRANKLIN RAINES?
Raines works for the Obama Campaign as Chief Economic Advisor
TIM HOWARD?
Howard is also a Chief Economic Advisor to Obama
JIM JOHNSON?
Johnson hired as a Senior Obama Finance Advisor and was selected to run
Obama's Vice Presidential Search Committee
Senators Chris Dodd, D(CT), and Kent Conrad, D (ND) chairman and senior members, respectively, of the Senate Banking Committee, received large loans from Countrywide at very favorable terms not available to ordinary citizens.
Jamie Gurelick (sp?), also a former member of the Clinton administration as were Raines and Johnson, was also a major player in the scandal as a senior official of Fannie Mae. She took away some $20 million dollars of tax payer money also.
Barney "BJ" Franks, D (MA) who is House Banking committee chairman, Dodd in the Senate, and other key dumocrats in the house and senate ran interference and prevented Republicans in Congress and the President from tightening controls on Fannie Mae and Freddy Mac until the scandal blew up out of control.
And, it is important to remember, the entire scandal originated with Jimmy "Peanut" Carter and Slick Willie who created policies that were carried out by his appointees running the giant lenders to first relax then completely remove lending standards so that anyone who wanted a loan, whether they had any ability whatsoever to pay them back, was granted a huge mortgage loan. The failure of hundreds of thousands, possibly one million or more democrat voters to repay mortgage loans is the reason the bailout is necessary.
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