Tuesday, May 6, 2008


"The two 'government-sponsored' mortgage giants aren't held to the same standards of accountability as everyone else in American business. ... The upshot is that former CEO Franklin Raines will forfeit some underwater stock options, make a donation to charity and pay $2 million to the government, although that sum will be convered by Fannie's officers-and-directors insurance. ... We fear this settlement--which Ofheo, the regulator values at $31 million for the three executives involved--is one more sign that Fannie Mae exists in a separate, politically protected universe. ... Friday's paltry settlement shows once again that Fannie and Freddie are dangerous because, as creatures of Congress, they can never be seen to have failed. So their accounting fraud is explained as merely a mistake, and their former executives keep the bulk of their riches", Editorial at the WSJ, 21 April 2008.

I agree. See also my 27 April 2008 post. The settlement was a joke.

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