Fannie Mae-No Politics (FNMA)

[kthomp19]

Net worth sweep was not dividend.

Wrong. It absolutely was a dividend.

Just look at the title of Section 3 on page 4 of the Third Amendment to the SPSPAs, otherwise known as the NWS:

3. Amendment to Paragraph 2(c) of Senior Preferred Stock (Relating to Dividend Rate and Dividend Amount).

Preferred stock dividends do not reduce the face value or liquidation preference of that preferred stock. And the seniors are equity, not a loan. Acting as if Treasury is obligated to write off the seniors because they have received more in dividends than the total draw amount doesn't actually make sense.

NWS is illegal or fraud for private shareholder companies.

Wrong again. The Supreme Court said (p. 2):

(a) The Recovery Act grants the FHFA expansive authority in its role as a conservator and permits the Agency to act in what it deter-mines is “in the best interests of the regulated entity or the Agency.” §4617(b)(2)(J)(ii) (emphasis added). So when the FHFA acts as a con-servator, it may aim to rehabilitate the regulated entity in a way that, while not in the best interests of the regulated entity, is beneficial to the Agency and, by extension, the public it serves.