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Three GOP Senators: Fannie Mae CEO’s 2006 Pay ‘Astounding’ January 31, 2007

Posted by notapundit in Congress, Politics, US News.

WASHINGTON (Dow Jones)–Three Republicans on the Senate Banking Committee blasted on Wednesday the $14.4 million in stock, bonuses and other compensation Fannie Mae (FNM) chief executive officer Daniel Mudd received last year as the company continues to emerge from its $6.3 billion accounting scandal.

Fannie Mae disclosed Mudd’s compensation late Friday.

“We are quite surprised that the Board of Fannie Mae would sign off on this compensation package at a time when they have paid almost $1.4 billion in accounting and consulting fees to clean up their financial mess, and they are still two years behind on their financial reporting,” Sens. Chuck Hagel, R-Neb., John Sununu, R-N.H., and Mel Martinez, R-Fla., said in a joint statement.

The lawmakers also criticized Fannie Mae’s top regulator, the Office of Federal Housing Enterprise Oversight, which approved Mudd’s compensation.

“We will be requesting from OFHEO an explanation as to why OFHEO signed off on this astounding development,” they said.

Hagel, Sununu, and Martinez have been outspoken critics of Fannie Mae and rival Freddie Mac (FRE), calling for tough new oversight of the companies. The Senate Banking Committee has not been able to pass legislation creating new oversight for the housing government sponsored enterprises because of sharp divisions between Democrats and Republicans on the panel. Senate Banking Committee Chairman Christopher Dodd, D-Conn., has said passing such legislation in a bipartisan manner is one of his top priorities this year. The statements from Hagel, Sununu, and Martinez, though, suggest that will not be easy.

“A central focus of this Congress must be robust oversight,” they said. “We intend to ensure that this extends to both the GSEs and their regulators. This includes the NYSE (New York Stock Exchange) and SEC (Securities and Exchange Commission) who continue to bend the rules and allow Fannie Mae to remain listed on the stock exchange without producing annual financial reports. The American taxpayer and the safety and soundness of our nation’s financial system and housing market require nothing less.”

By Damian Paletta, Dow Jones Newswires


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