Charles Grassley Questions Diversion of Fannie and Freddie Earnings
This is pretty interesting!
By GRETCHEN MORGENSONAPRIL 7, 2015
Charles Grassley is asking why the government kept a lid on bailout repayment documents. Credit Drew Angerer/Getty Images
For almost two years, shareholders of Fannie Mae and Freddie Mac have been asking the United States government about its 2012 decision to divert all of the mortgage finance giants’ earnings to the Treasury rather than let them repay taxpayers under the original bailout agreement.
But the government has declined to disclose documents relating to that decision, contending that some may be subject to presidential privilege.
Now, this cloak of secrecy has drawn the scrutiny of Charles E. Grassley, the Iowa Republican who is chairman of the Senate Judiciary Committee. On Tuesday, Mr. Grassley sent letters to the Justice Department and the Treasury asking for details about the decision and why the government has kept such a tight lid on documents relating to it.
“The taxpayer has a right to know what has transpired,” Mr. Grassley wrote in letters to both Eric H. Holder Jr., the United States attorney general, and Jacob Lew, the Treasury secretary. “But, instead of transparency, there appears to be an invocation of executive privilege. If true, this is cause for concern.”
Tim has letter here:
The taxpayer has a right to know what has transpired. But, instead of transparency, there
appears to be an invocation of executive privilege. If true, this is cause for concern.
Accordingly, please provide the following:
1. Has the President personally invoked executive privilege over documents related to the
Fannie Mae, Freddie Mac and Treasury Third Amendment agreement? If so, when? If
not, why are DOJ attorneys citing that privilege as a reason to withhold those documents?
2. Does the Third Amendment cause a breach of any of FHFA’s statutory duties to ensure
that each regulated entity operates in a safe and sound manner? Please explain.
3. During the negotiation of the Third Amendment between Treasury and FHFA, did DOJ
communicate with any of the entities involved regarding its legality? If so, please
describe those communications in detail.
4. Under what legal authority was the Third Amendment authorized?
5. Prior to litigation, did DOJ discuss with Treasury and/or FHFA the need to assert
privileges, including executive privilege, over certain documents?