The Washington Post once again did what it does so well. It uncovered some nasty documents, in this case about Fannie Mae (FNM) and Freddie Mac (FRE).
“Internal Freddie Mac documents show that senior executives at the company were warned years ago that they were offering mortgages that could pose dangers to the firm, hurt borrowers and generate more risky loans throughout the industry.”
“At Fannie Mae, top executives were told it was necessary to develop `underground’ efforts to buy subprime mortgages because of competitive pressures, although there were growing risks and borrowers often didn’t understand the terms of the loans, documents show.”
It is likely that no one did anything about its because both the companies and their managements were making so much money. It was ever thus.
Douglas A. McIntyre
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