(In the midst of a deep mortgage crisis in this country, you’ve got to wonder whether somebody thought this fending off of regulation would eventually backfire. I personally believe that the worst is yet to come from the credit crunch…)
The two giants in the mortgage business seemed to have prevented regulation through strong lobbying efforts. Here are some names of the politicians involved in networking with Fannie Mae and Freddie Mac.
Both Fannie Mae and Freddie Mac have proven exceptionally adept at lobbying Congress to preserve and enhance their privileges. Any effort that relies on new regulations will likely perpetuate the risk to the financial market and preserve their dominant influence. Indeed, if Armando Falcon, director of the Office of Federal Housing Enterprise Oversight (OFHEO), had not courageously persisted in exposing Fannie Mae’s suspect operations, often in the face of congressional hostility, former Fannie Mae President Franklin Raines would still have his job and Fannie Mae’s shaky finances and fabricated earnings would still be hidden.