House leaders include Manzullo bill in Fannie Mae/Freddie Mac reform package
Washington, DC – May 16, 2011 – (RealEstateRama) — Congressman Don Manzullo (R-Egan) has unveiled legislation to require Fannie Mae and Freddie Mac to continue paying annual dividends back to the US Treasury to ensure the “ringleaders” of the housing crisis keep paying off their debt to American taxpayers.
The legislation Manzullo will introduce prohibits the Treasury Department from reducing the 10 percent dividend payment Fannie and Freddie currently make annually to reimburse taxpayers for the hundreds of billions of bailout funds the mortgage giants received to date. Fannie and Freddie are considered Government Sponsored Enterprises (GSEs).
“We were irate when the ringleaders of the housing collapse – Fannie Mae and Freddie Mac – were given a complete pass in the financial reform bill last Congress despite the fact that the taxpayer liability for their losses could reach $1 trillion,” said Manzullo. “Fannie and Freddie must continue to pay their debts back to taxpayers, and that’s exactly what we expect to accomplish with this legislation.”
Since 2000, Manzullo has been fighting Fannie and Freddie for what he considers illegal and unethical practices, such as cooking the books to get higher bonuses for the officers, and fraudulently using lobbyists and fake surveys to fight reform. In 2000, 2003 and 2005, he co-sponsored legislation that would have required higher capital requirements for Fannie and Freddie so the housing crisis would not have occurred, at least not to the current extent. Manzullo exposed some of Fannie and Freddie’s unethical practices during several Financial Services Committee hearings. Click here to view highlights of one of those hearings from 2004.
Rep. Scott Garrett (R-NJ), who chairs the House Financial Services Subcommittee on Capital Markets and Government Sponsored Enterprises, discussed Manzullo’s legislation at a media briefing on Capitol Hill along with six other bills the subcommittee is considering to reform Fannie Mae and Freddie Mac. Manzullo joined Garrett at the media briefing.
“Republicans and Democrats in Congress, as well as the Obama administration, all agree that the current trajectory of Fannie Mae and Freddie Mac is unsustainable,” Garrett said. “These seven bills were carefully designed to tie the hands of Fannie and Freddie so that they are no longer a drag on the American taxpayers, a threat to our economic security, and an impediment to private market growth and development.”