The Federal Housing Finance Agency (FHFA) and Fannie Mae have announced the dismissal of more than 100 employees from Fannie Mae after they were caught engaging in unethical conduct, including acts of fraud.
“In President Trump’s housing market, there is no room for fraud, mortgage fraud, or any other deceitful act that can jeopardize the safety and soundness of the housing industry,” said William J. Pulte, Chairman of the Board of Directors of Fannie Mae and Director of the FHFA. “Since my swearing-in, we fired over 100 employees from Fannie Mae who we caught engaging in unethical conduct, including facilitating fraud, against our great company. Anyone who commits fraud against Fannie Mae does so against the American people.”
News of the dismissals from the GSE comes after reports Fannie Mae laid off 700 employees in the U.S. late last week, citing ethical violations stemming from allegations of misuse of the company’s Matching Grants Program.
“I would like to thank Director Pulte for his empowering of Fannie Mae to root out unethical conduct, including anyone facilitating fraud,” said Priscilla Almodovar, President and CEO of Fannie Mae. “We hold our employees to the highest standards, and we will continue to do so.”
In a Q3 2024 Securities and Exchange Commission filing, Fannie Mae reported that it had experienced financial losses due to mortgage fraud, and that it was investigating multifamily lending transactions where fraud was suspected.
According to MultifamilyDive, Fannie Mae stated in the SEC report that, “Certain gaps have been identified in our processes for managing multifamily loan origination fraud risk and for overseeing our multifamily seller/servicer counterparties … In the future, we may experience additional financial losses as a result of mortgage fraud.”
News outlet Techstory reports that 200 Telugu workers were part of the 700 employees laid off, amid allegations of misuse and fraud of the company’s Matching Grants Program, a program that allows employees to donate to charitable organizations with the company matching those contributions. Reports found that some employees conspired to exploit the GSE’s Matching Grants Program for personal gain, resulting in millions of dollars being misappropriated over the course of several years.
The dismissals at Fannie Mae are the latest action taken by the Trump administration to consolidate and wind down agencies overseeing the nation’s housing market.
The Consumer Financial Protection Bureau (CFPB) recently avoided being shut down as a U.S. District Judge denied actions by the Trump administration from firing Bureau employees, and ordered the reinstatement of workers who were previously terminated.
The Trump administration allegedly planned to eliminate nearly 1,200 workers of the agency’s approximate staff of 1,700. And in a second phase of job cuts, The Hill reported that several CFPB employees said they were told the Bureau would be “wound down,” eliminating all but five employees, and moving its required day-to-day operations to other governmental agencies.
MortgagePoint reached out to Fannie Mae’s Media Relations Department seeking comment on the firings but had not heard back as we went to press.
