1. They were vindicated in the criminal trial. They chose not to fight the civil suit. Read what Raines was quoted saying not just the headline. These were trumped up charges by an administration philosophically opposed to the Gse's . The fraud, if there was fraud, was pushing earnings from the future into the present.
2. Freddie "borrowed" less money 72 billion vs 117 billion. In Freddie's case in 2002-2004 they actually were accused of smoothing earnings to hide derivative fluctuations. We have talked about this at length in the past.
Freddie actually under reported earnings to remove interest rate fluctuations on earnings in 2002-2003.
3. None of these violations misrepresented the long run earnings picture at either of the companies. The problems were caused by the Bush administration's replacements for those who were forced out in 2004.
4. Considering the deception on Iraq, I have hard time believing anybody in that administration. If the press can be totally fooled on wmd in Iraq, they can easily be fooled about the Gse's.
5. Of course their new defense is we lied, made mistakes on Iraq, but it was for a " good cause". Similar logic is used in your defense of Paulson on Fannie Mae, Freddie Mac. The problem is where does it stop?
Who trusts this government in the next crisis if this precedent is allowed to stand? I am sure Nixon would have said the Watergate and similar misdeeds were for a "good cause".
