Oct. 6, 2004 Fannie Mae accountant: I warned CEO Raines

collegemom16 · 09-17-2008, 04:52 PM

Quote:

WASHINGTON - The former Fannie Mae accountant who raised questions about the mortgage giant’s bookkeeping said Wednesday that he took his concerns directly to chief executive Franklin Raines in 2002 and asked him to investigate.

The disclosure by Roger Barnes, who left Fannie Mae last November, came as Raines and chief financial officer Timothy Howard defended the company’s accounting and told Congress that regulators’ allegations of earnings manipulation represent an interpretation of complex rules.

Fannie Mae accountant: I warned CEO Raines - Corporate scandals - MSNBC.com

Senator McCain tried to introduce regulation over Fannie/Freddie back in 2006:

FEDERAL HOUSING ENTERPRISE REGULATORY REFORM ACT OF 2005

The United States Senate

May 25, 2006 Section 16

McCain is quoted: "For years I have been concerned about the regulatory structure that governs Fannie Mae and Freddie Mac--known as Government-sponsored entities or GSEs--and the sheer magnitude of these companies and the role they play in the housing market. OFHEO's report this week does nothing to ease these concerns. In fact, the report does quite the contrary. OFHEO's report solidifies my view that the GSEs need to be reformed without delay.
I join as a cosponsor of the Federal Housing Enterprise Regulatory Reform Act of 2005, S. 190, to underscore my support for quick passage of GSE regulatory reform legislation. If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole."

Senator McCain saw the problem in 2005.

Meanwhile, Senator Obama has 2 former CEO’s of Fannie/Freddie (Franklin Raines is one of them) as economic advisors, and is a major recipient of campaign contributions.

ldmom06 · 09-17-2008, 04:59 PM

And this is Obama's economic advisor??
---------------------------------------------

"WASHINGTON - The former Fannie Mae accountant who raised questions about the mortgage giant’s bookkeeping said Wednesday that he took his concerns directly to chief executive Franklin Raines in 2002 and asked him to investigate.

The disclosure by Roger Barnes, who left Fannie Mae last November, came as Raines and chief financial officer Timothy Howard defended the company’s accounting and told Congress that regulators’ allegations of earnings manipulation represent an interpretation of complex rules.

The regulators have said that information provided by Barnes was important to their investigation of the government-sponsored company’s accounting.

“I urged Mr. Raines and Mr. Howard to investigate the issues identified,” Barnes said in written testimony submitted for a hearing by the House Financial Services subcommittee that oversees Fannie Mae and Freddie Mac, its smaller rival in the multitrillion-dollar home mortgage market.

“Neither Mr. Raines nor Mr. Howard, nor anyone from their staffs, investigated these concerns or took corrective action,” he said. “Thus, the practices I had identified continued, and I faced continuing reprisal for raising concerns about these issues.”

Barnes, who was a manager in the Controller’s Division, said that he anonymously sent the two executives a memo on Sept. 23, 2002, calling himself a Finance Division Manager. The information he provided was “easily traceable” to him because he was among only a handful of managers who had detailed data on the company’s process for accounting for expenses over time, said Barnes.

At Fannie Mae, he said, “The atmosphere and culture, particularly within the Controller’s Division, is one of intimidation, restraint of dissenting opinions and pressure to be part of the ’team,”’ giving Raines and Howard the numbers they sought to please the markets."

mini · 09-17-2008, 05:04 PM

"Senator McCain saw the problem in 2005."

Republicans controlled the Senate. Republicans controlled the House. Republicans controlled the White House. McCain chaired the Senate Commerce Committee. McCain "reaches across the aisle".

A record of achievement.

-Allmusic- · 09-17-2008, 05:05 PM

Lol!

ldmom06 · 09-17-2008, 05:08 PM

mini - I think you may be ignoring the Clinton-era social engineering part of the Fannie/Freddie problem.

(still laughing allmusic?)

mini · 09-17-2008, 05:13 PM

I'm not ignoring ANYTHING. As you know, I was/am no fan of Clinton, and I am not a Democrat. The social engineering of the giant loan from China/Saudi Arabia, etc., incorrectly called the "Bush tax cuts" is the source of the general mess.

But McCain had specific statutory authority to clean up the Fannie/Freddie mess, the chairmanship of the committee, and his party in all major arenas of power. And he had SIX YEARS to do it.

And he failed utterly.

katliamom · 09-17-2008, 05:16 PM

welcome back mini. missed ya.

collegemom16 · 09-17-2008, 05:23 PM

Senator Obama and Senator Jack Reed of RI held up any serious reform of Fannie Mae in order to cut out a “low income trust fund” that Fannie had to pay money into to offer loans to bad credit risks.

The NILCH (National Institute for low income housing) had a press release that featured Senator's Reed and Obama talking about what a wonderful program that was in May of this year.

They were buying votes with Fannie Mae all the while Senator McCain was calling for divesture of some loans in order to shore up Capital Reserves.

collegemom16 · 09-17-2008, 05:43 PM

Fannie Mae pumped funds into voter fraud specialists ACORN. That organization pressed for the grant of mortgages to unqualified buyers, leading to the subprime mortgage mess and Fannie Mae collapse.
The organization are also linked to Chicago politician and "post-partisan" nominee for President, Senator Barack Obama:

ACORN is a former legal client of Senator Obama's, as the Sun-Times reported in 2006:

As lawyer, Obama was strong, silent type :: CHICAGO SUN-TIMES :: Barack Obama

In 1995, former Republican Gov. Jim Edgar refused to implement the federal "Motor Voter" law, which Republicans argued could invite fraud and which some Republicans feared could swell the ranks of Democratic voters.

The law-mandated people be allowed to register to vote in government offices such as driver's license renewal centers.

Obama sued on behalf of ACORN, the Association of Community Organizations for Reform Now. The League of Women Voters and other public-interest groups joined in.

"He and his client were the ones who filed the original case -- they blazed the trail," said Paul Mollica, who represented the League.

ldmom06 · 09-17-2008, 05:44 PM

peace mini....please stay.

collegemom16 · 09-17-2008, 05:54 PM

After completing law school, Senator Obama took on his new role organizing “Project VOTE” in 1992. This project was undertaken in direct partnership with ACORN. Mr. Obama also volunteered his services yearly as a key figure in Acorn’s leadership-training seminars. Furthermore, Obama’s service on the boards of Woods Fund and the Joyce Foundation allowed him to help direct tens of millions of dollars in grants to various organizations, including Chicago Acorn, whose endorsement Obama sought and won in his State Senate race.

collegemom16 · 09-17-2008, 05:57 PM

The present subprime financial strains have as its genesis the policies promoted in the Community Reinvestment Act (CRA), compliance with which is a prerequisite for financial institution innovation. The “Community Reinvestment Act” seeks input from “Community Organizers” like ACORN in rating financial institutions on their compliance in issuing subprime loans. Without satisfying “Community Organizers,” financial institutions cannot escape depression era restrictions on innovation. What is the price of this satisfaction? Today it seems to be the federal bailout of Fannie Mae and Freddie Mac, at the cost of billions of taxpayer dollars.

collegemom16 · 09-17-2008, 05:59 PM

When the CRA was created during the Carter administration, the administration also funded with tax dollars numerous "community groups" that have helped the Fed, the Comptroller of the Currency, and other federal regulatory agencies to enforce the act. Under the CRA, if a bank wants to make virtually any change in its business operations — merging, opening up a new branch, getting into a new line of business — it must first prove to regulators that it has made "enough" loans to the government's preferred borrowers. The (partially) tax-funded "community groups" like ACORN (Association of Community Organizations for Reform Now) can file petitions with regulators that stop the bank's activities in their tracks, perhaps defeating them altogether. The banks routinely buy off ACORN and other "community groups" by giving them millions of dollars as well as promising to make even more dubious loans.

samiamy · 09-17-2008, 06:24 PM

ttp://74.125.45.104/search?q=cache:V-Id_ZmB0zQJ:http://www.govtrack.us/congress/bill...&client=safari

A screen shot, as the .gov website says it is down, but a shot of the "original"

"american Dream Home Act" that was sponsored

S. 811 [108th]: American Dream Downpayment Act
A bill to support certain housing proposals in the fiscal year 2003 budget for the Federal Government, including the downpayment assistance initiative under the HOME Investment Partnership Act, and for other purposes.

Overview
Summary
Amendments
Articles About This Bill
No articles are associated with this bill.

You can suggest an article for inclusion here.

Sponsor:
Sen. Wayne Allard [R-CO]show cosponsors (9)
Bill Text:
Summaries (CRS)
Full Text

Cosponsors [as of 2006-11-19]
Sen. Samuel Brownback [R-KS]
Sen. Conrad Burns [R-MT]
Sen. Ben Campbell [R-CO]
Sen. Michael Crapo [R-ID]
Sen. Michael Enzi [R-WY]
Sen. Charles Hagel [R-NE]
Sen. Lisa Murkowski [R-AK]
Sen. Richard Santorum [R-PA]
Sen. Jefferson Sessions [R-AL]
Cosponsorship information sometimes is out of date. Why?
Bill Text:

Status:
Introduced Apr 8, 2003
Amendments (1 proposed) [details]
Passed Senate [details] Nov 24, 2003
Passed House Dec 8, 2003
Signed by President Dec 16, 2003
This bill became law.

Current Reforms and Reform Legislation

Current Reforms and Reform Legislation

Overview

Reform legislation -

The Expanding the American Homeownership Act, H.R. 1852, known as FHA Reform or FHA Modernization, was approved by the U.S. House Financial Services Committee on May 3, 2007. The bill now awaits a vote by the full House of Representatives. It will enable the FHA to reach more prospective borrowers and allow millions more low- and moderate-income families to achieve the American dream of homeownership.

Some of the highlights of the legislation include:

FHA mortgage limits:

Increase the limit for lower cost areas from 48% to 65% of the government sponsored enterprises (GSE) conforming loan limit, permitting the FHA to insure newly constructed homes.

Increase the limit for higher cost areas from 87% to 100% of the conforming limit with individual local limits set at the median price of a home in each area.

Because of the FHA's current mortgage limits, borrowers in high cost housing markets who don't qualify for prime mortgages have no option other than high cost loans.

Downpayment:

Eliminates the FHA's 3% minimum cash investment requirement and downpayment calculation.

Provides FHA borrowers a range of options to control the amount of their downpayment and mortgage payment based on their immediate and long-term goals.

and it goes on and on...

barrons · 09-17-2008, 06:26 PM

"Community Organizer" is another term for shakedown artist. The Media has totally ignored the dubious results and actions of these "Community Organizers".