WASHINGTON, DC – January 25, 2011 – (RealEstateRama) — Congressman Randy Neugebauer (R-TX) released the following statement today regarding today’s New York Times report on Fannie Mae and Freddie Mac legal defense fees:
“Today’s article in the New York Times details my investigation regarding legal fees expended by Fannie Mae and Freddie Mac in defense of the officials who led those organizations prior to, and during the subprime mortgage mess is troubling at best. My investigation raises serious questions about the conservators’ responsibilities to prevent any further losses to the American taxpayer. Over $160 million of the taxpayer’s money was spent for securities-related lawsuits and indemnification agreements for Freddie and Fannie executives.
“The documents referenced in today’s news story raise many more questions than they answer. Are the conservators looking out for the taxpayers? Do they have the right tools and structure to do so? My intent is to investigate other activities occurring within Fannie Mae and Freddie Mac that diminish the taxpayers’ potential recovery and minimize capital infusion. This drain on the American taxpayer must be plugged as quickly as possible.
“The aggregate number amounts the taxpayer has expended thus far are listed below:
• Total Amount of Legal Expenses Post Conservatorship for Freddie and Fannie: $410.7 million
• Total Legal Fees for Securities-related Lawsuits and Indemnification Agreements for Freddie and Fannie: $162.4 million
• Post-Conservatorship Indemnification Legal Fees Broken Down by Company:
Freddie – $5,792,314 * excludes positions below Executive Vice President
Fannie – $51,741,767
Total: $57,534,081
• Fannie Legal Advances Post Conservatorship:
Franklin Raines: $7.9 million
Leanne Spencer: $11.8 million
Tim Howard: $4.5 million
Other Executives: $12 million
Non-Executives: $15.3 million
Total: $51.7 million
• Pre-Conservatorship Indemnification Legal Fees Broken Down by Company:
Freddie: $27.8 million
Fannie: $93.1 million
Total: $120.9 million
• Fannie Pre-Conservatorship Indemnification:
Franklin Raines: $29.8 million
Leanne Spencer: $19.5 million
Tim Howard: $13.4 million
Other Executives: $12.4 million
Non-Executives: $17.9 million
Total: $93.1 million”
