(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.
The emphasis was added by the Court, not me.
They said that 4617(b)(2)(J)(ii) allows FHFA to do something that is not in the best interests of the companies, like the NWS, if FHFA determines that it is in the best interest of the Agency, i.e. FHFA itself.
It is a bizarre, stupid, and incomprehensible ruling, but is it the ground truth we have to deal with now. By any estimation FHFA should have a fiduciary duty to the companies, but the Supreme Court said FHFA can override that by acting in its own interests instead.