From an email”
Here is a quick look into 3 former Fannie Mae executives who
have brought down Wall Street.
Franklin Raines was a Chairman and Chief Executive Officer at
Fannie Mae. Raines was forced to retire from his position with Fannie
Mae when auditing discovered severe irregulaties in Fannie Mae’s
accounting activities. At the time of his departure The Wall Street
Journal noted, ‘ Raines, who long defended the company’s accounting
despite mounting evidence that it wasn’t proper, issued a statement late
Tuesday conceding that ‘mistakes were made’ and saying he would assume
responsibility as he had earlier promised. News reports indicate the
company was under growing pressure from regulators to shake up its
management in the wake of findings that the company’s books ran afoul of
generally accepted accounting principles for four years.’ Fannie Mae
had to reduce its surplus by $9 billion..
Raines left with a ‘golden parachute valued at $240 Million in
benefits. The Government filed suit against Raines when the depth of the
accounting scandal became clear.
http://housingdoom.com/2006/12/18/fannie-charges/ . The Government
noted, ‘The 101 charges reveal how the individuals improperly
manipulated earnings to maximize their bonuses, while knowingly
neglecting accounting systems and internal controls, misapplying over
twenty accounting principles and misleading the regulator and the
public. The Notice explains how they submitted six years of misleading
and inaccurate accounting statements and inaccurate capital reports that
enabled them to grow Fannie Mae in an unsafe and unsound manner.’ These
charges were made in 2006. The Court ordered Raines to return $50
Million Dollars he received in bonuses based on the miss-stated Fannie
Mae profits.
Tim Howard - Was the Chief Financial Officer of Fannie Mae.
Howard ‘was a strong internal proponent of using accounting strategies
that would ensure a ’stable pattern of earnings’ at Fannie. In everyday
English - he was cooking the books. The Government Investigation
determined that, ‘Chief Financial Officer, Tim Howard, failed to provide
adequate oversight to key control and reporting functions within Fannie
Mae.
On June 16, 2006, Rep. Richard Baker, R-La., asked the Justice
Department to investigate his allegations that two former Fannie Mae
executives lied to Congress in October 2004 when they denied
manipulating the mortgage-finance giant’s income statement to achieve
management pay bonuses. Investigations by federal regulators and the
company’s board of directors since concluded that management did
manipulate 1998 earnings to trigger bonuses. Raines and Howard resigned
under pressure in late 2004.
Howard’s Golden Parachute was estimated at $20 Million!
Jim Johnson - A former executive at Lehman Brothers and who
was later forced from his position as Fannie Mae CEO. A look at the
Office of Federal Housing Enterprise Oversight’s May 2006 report
<http://www.ofheo.gov/media/pdf/FNMSPECIALEXAM.PDF> on mismanagement
and corruption inside Fannie Mae, and you’ll see some interesting things
about Johnson. Investigators found that Fannie Mae had hidden a
substantial amount of Johnson’s 1998 compensation from the public,
reporting that it was between $6 million and $7 million when it fact it
was $21 million.’ Johnson is currently under investigation for taking
illegal loans from Countrywide while serving as CEO of Fannie Mae.
Johnson’s Golden Parachute was estimated at $28 Million.
WHERE ARE THEY NOW?
FRANKLIN RAINES? Raines works for the Obama Campaign as Chief Economic
Advisor
TIM HOWARD? Howard is also a Chief Economic Advisor to Obama
JIM JOHNSON? Johnson hired as a Senior Obama Finance Advisor and was
selected to run Obama’s Vice Presidential Search Committee
IF OBAMA PLANS ON CLEANING UP THE MESS - HIS ADVISORS HAVE THE EXPERTISE
- THEY MADE THE MESS IN THE FIRST PLACE.
Am I the only one to be infuriated?
Would you trust the men who tore Wall Street down to build the New Wall
Street ?
