For what its worth. Here is a letter I wrote to Pulte. I hope it gets to him and not intercepted by lower-level staff. I know I open myself to criticism by posting, but thought I would give it a go. Others can modify for their own use.
April 22, 2025
The Honorable William J. Pulte
Director, Federal Housing Finance Agency
400 7th Street, SW
Washington, D.C. 20219
Subject: Action requested to up list and end the Conservatorship of Fannie Mae and Freddie Mac
Dear Director Pulte;
First, congratulations on your new position. I certainly agree with many, you are the most qualified. Your actions to date are appreciated.
It is past due to uplist Fannie Mae and Freddie Mac to the NYSE and end the unethical and illegal conservatorship.
As a nation founded on the rule of law, I request you to address how the Intent and Spirit of the Housing and Economic Recovery Act of 2008 (HERA) has been misrepresented and violated due to one critical word in the legislation. The law was written with "may" rather than "shall," creating room for bureaucrats and unscrupulous actors to interpret it as optional. This misinterpretation has led to ongoing abuses of power, causing anger among the American people and leading to numerous lawsuits. Unfortunately, due to the phrasing of "may," the courts have been unable to intervene effectively.
The Net Worth Sweep was the most egregious theft in American history. The opposite of “Preserve and Conserve”. As a successful businessman, you would not have agreed to those terms. Here are a few quotes you may appreciate:
1) From the attached letter by former President Trump to Senator Rand Paul, “The idea that the government can steal money from its citizens is socialism and is a travesty brought to you by the Obama/Biden administration”.
2) Federal Judge Margaret Sweeney called this a “mafia style loan”.
3) Federal Judge Edith Hollan Jones said, “The treasury has been compensated like a Pay Day Lender”.
4) Federal Judge Janice Rogers Brown, wrote, “This was an act of a banana republic”.
5) Former FHFA Director Mel Watt; “The law was trumped before I got there”.
6) Former US Congressman Mike Capuano; “The shareholders of FMNA & FMCC have been screwed for years unnecessarily. They have been paid back three times over”.
7) Former FHFA director Mark Calabria, who drafted HERA, “Ed DeMarco should be standing in front of a judge”. In regards to the implementing the Net Worth Sweep.
8) Supreme Court Justice Sotomayor - "For no rational reason, FHFA sold all of Fannie and Freddie's assets, in exchange for $1.00, to itself. It did exactly what Justice Breyer said, it nationalized things. It nationalized the companies".
9) Supreme Court Justice Breyer’s comment “This is a takings case.” “They say, nationalization is not the kind of thing conservators and receivers do and, therefore, you can examine it. And when you examine it, you will see how unreasonable it is”.
11) “The court will not condone the misuse of a protective order as a shield to insulate public officials from criticism in the way they execute their public duties”. ORDER GRANTING MOTION TO DE-DESIGNATE SEVEN DOCUMENTS; Judge Margaret M. Sweeney, April 13, 2016.
12) On January 23, 2025, Mark Calabria, former Director of the Federal Housing Finance Agency (FHFA), stated on X (formerly Twitter), "One of the more disappointing aspects of Fannie/Freddie conservatorships is the degree to which so many DC insiders believe agencies outright ignoring the law is a completely normal and fine outcome".
HERA 2008 was designed to stabilize the real estate mortgage markets. Yet, Treasury’s actions—including the forced loan to Fannie Mae and Freddie Mac and the imposition of the "Net Worth Sweep" demonstrate a clear violation of the law’s Intent and Spirit meaning. The loan, carrying 10% interest and nearly 80% in warrants for Treasury, was intended to help Fannie and Freddie manage toxic mortgages from "too big to fail" banks. Yet, despite repaying over $301 billion dollars on a $191 billion dollar loan, the terms of the Net Worth Sweep ensured Fannie and Freddie would never be able to exit conservatorship.
The NWS, which extracted over $301 billion dollars from Fannie Mae and Freddie Mac, was a blatant case of self-dealing that enriched the Treasury Department at the expense of the GSEs. Fannie and Freddie should have been able to pay off the loan by 2015, but instead, their profits were siphoned off through excessive and unjustified dividend payments. This is in direct violation of HERA’s provisions restricting capital distributions during conservatorship.
Furthermore, the Senior Preferred Stock Purchase Agreement, which imposes a commitment fee on Fannie and Freddie, is illegal under federal law. As Mark Calabria has pointed out, the Treasury’s actions in this regard; charging a commitment fee violate federal statutes, and the Treasury owes Fannie Mae and Freddie Mac the overage payments, with compounded interest.
It is well past time to end the conservatorship of Fannie Mae and Freddie Mac. These institutions have proven their financial strength, as evidenced by their performance in Dodd-Frank stress tests and their ability to generate more than $20 billion dollars annually. They pay more in income taxes than many Fortune 500 companies, yet they remain trapped under an illegal and unjust conservatorship that benefits bureaucrats and Treasury officials rather than the American public.
By ending the conservatorship, Fannie Mae and Freddie Mac can return to their original role, in serving the mortgage markets and the American people. This action will eliminate the legal entanglements that have undermined these institutions and allow them to operate as private companies under appropriate oversight.
We, as ordinary citizens, seek your guidance and management in ensuring justice for Fannie Mae and Freddie Mac, which will ultimately benefit the broader American economy and the housing market. Upon release; Fannie Mae and Freddie Mac should issue a one-time special dividend of $10 to $15 dollars to stock holders.
Thank you for your attention to this critical matter.
Sincerely,
AI
