Baker Wants Fannie Mae to Return Bonuses Based on "Faulty Bookkeeping"
WASHINGTON - Congress Richard Baker (R-La.), chairman of the House Capital Markets, Insurance and Government Sponsored Enterprises sent a letter to the Office of Federal Housing Enterprise Oversight, asking for the agency's help in getting current and former leaders of Fannie Mae to return bonuses they were paid based on flawed accounting that became evident about the company last year. In his Dec. 16 letter to OFHEO Director Armando Falcon, Baker wrote that, "The findings of the Chief Accountant raise significant concerns about the safety and soundness of Fannie Mae. I request your office take action to recapture all bonus payments from executives that were awarded based upon the faulty and deeply flawed earnings statements of the enterprise." According to the Associated Press, from 2001 to 2003, Fannie Mae awarded bonuses of $10.6 million for its former Chairman and Chief Executive Officer Franklin Raines and $2.65 million for former chief financial officer J. Timothy Howard. Newly appointed interim CEO Daniel Mudd received $3.28 million, and interim CFO Robert Levin got $2.06 million in bonuses.