FHFA chief slashes Inspector General budget, firing dozens of mortgage fraud investigators

Last year, FHFA director Bill Pulte proclaimed an aggressive campaign against mortgage fraud, a claim now called into question after he ordered deep cuts to the agency’s Inspector General office. The reduction will dismiss about 40 special agents who have helped achieve more than 1,200 criminal convictions and retrieve close to $75 billion linked to Fannie Mae and Freddie Mac. Acting Principal Deputy Inspector General James Hodge warned that the cuts will strip the office of its ability to investigate fraud involving the entities FHFA regulates.

Pulte defended the budget cut as a relative expense issue, without mentioning his earlier fraud-crackdown pledge. Senate Banking Committee Democrats wrote to Pulte demanding a reversal, labeling the move unacceptable and a sign that the administration is evading accountability. Critics also note that Pulte’s past attempts to target political opponents for alleged mortgage misconduct have largely failed, and a GAO probe is examining whether he misused his position to access opponents’ mortgage data.