Freddie Mac Chief Ignored Warnings

The chief executive of the mortgage giant Freddie Mac rejected internal warnings that could have protected the company from some of the financial crises now engulfing it, according to more than two dozen current and former high-ranking executives and others.

That chief executive, Richard F. Syron, in 2004 received a memo from Freddie Mac's chief risk officer warning him that the firm was financing questionable loans that threatened its financial health.

Today, Freddie Mac and the nation's other major mortgage finance company, Fannie Mae, are in such perilous condition that the federal government has readied a taxpayer-financed bailout that could cost billions. Though the current housing crisis would have undoubtedly caused problems at both companies, Freddie Mac insiders say Mr. Syron heightened those perils by ignoring repeated recommendations.

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Read up on the mortgage crisis and Freddie and Fannie at the Huffington Post's Mortgage Crisis big news page.

Comments

[ItHasToGetBetter]

Here we go again. Bad decisions made. People responsible are overcompensated and everyone else foots the bill. Even when the warnings were there, people kept doing it anyway. Now I get to help pay for it. Thanks a million.

[javaman]

Asked about the poor, mr freddie mac answered, "there's poor?"

[Donns]

It's ok everyone don't worry, his bonus is still intact

[Mr Grey]

More from the smartest guys in the room!

[totaldisbelief]

And just how many millions a years does this guy get ?

[lvdragonlady]

Why does he still have his job?
For the amount of money CEO's and upper management makes from big corporations, you think that:
1. they would be responsible for their actions or inactions(the little guys are).
2. wages should be based on corporate/business performance.

ARE YOU YOUR COMPANIES WORSE ENEMY?

[darthdarcy]

We were warned about bin-Laden before 9/11 and Bush and Condi Rice didn't listen, so why should Freddie Mac..!

"Heck of a job you're doin, Freddie..."

[esquire07]

Lol... is anyone really surprized ??? All that matters is immediate profits and quarterly earnings... to hell with everything else !!!

America is simply getting what it deserves.... Karma will not be kind to a nation of bloodthirsty, Oil dependent, murderers.

The Constitution is dead. The nation belongs to Corporate Criminals and the Military Industrial Complex. The repubs will destroy Obama, the ignorant and blind American populace will elect John McCain, and the US will plundge into a depression and dark ages like the World has never known.

Hold on America, your troubles have not even begun.

[Jules1]

Not oner taxpayer should help bail them out, people need to start a petition to that effect. Why should we bail them out when so many are hurting, let them go it alone. Not our problem!!!!!!!!!

[JoeBlough]

So, why hasn't he been arrested yet?

[totaldisbelief]

can you spell: C O N N E C T E D ?

[Moshe]

FYI: Anytime you separate decision-making authority from ultimate accountability, expect big trouble.

The people that had control in this fiasco knew that they could do whatever they pleased in the short term, and in the longer term, the tax payers would get stuck with the bill.

So that's exactly what happened.

We were supposed to have government officials exercising oversight to make sure this sort of thing didn't happen (again), but guess what?

Government officials now all know that there is no longer any accountability for them either.

So what high government offiicials were ever held accountable for the failures leading up to 9/11? Iraq war lies? The following fiasco in Iraq? Abu Ghraib? Katrina? The post-Katrina tax payer rip offs? Domestic spying?

So why would any other high government officials think they would be accountable?

As Justice Brandeis said: "Crime is contagious. If the government becomes a law breaker, it breeds contempt for the law."

You either enforce the Rule of Law fairly and evenly for all persons regardless of their status, or you no longer have a nation under the Rule of Law.

When that's allowed to continue, expect the looting of the tax payers to continue, at least till the moneys all gone and we can't borrow any more from the Chinese, etc.

The Rule of Law was the only thing guarding our life, liberty, property, and future.

But looks like Americans are going to have to learn the hard way (again).

[philipwitak]

let's see. private enterprise [meaning all profits are internalized] that benefits immensely from the formerly implied and now formally declared financial backing of the united states government [meaning all loses are externalized].

a very sweet deal, indeed, for syron and company - but a bitter one for the rest of us.

[Rule Of Law]

2nd attempt...

It's just like kids in school cheating and saying, "Well, everybody else does it!"

There's no difference between this Administration and a Crack Dealer. The same soulless preying upon the weakest and most defenseless of our citizens--one sells poison in a powder or a rock, the other sells fear, suspicion, anger and doubt.

The ultimate tragedy of it is that WE believe these pushers when they tell us they have the answer. And WE line up to go off and die in some backwater country while they spend the profits from our blood on vacations in Canne, or Aruba! We're stupid. We're ignorant. We're gullible. And when they come to sell us the next war to enrich the Elites, we'll do it all over again. We'll wave the flag, shout hooah, semper fi, and run off to--to what? To die for some Investment bank or Military weapons manufacturer, or oil company? To come home missing an arm or leg or sanity for some Liars in the White House?

At least a crack dealer will do time if caught. But our "Leaders" and top 1%ers can sell us their bogus patriotic crack, wrapped in pretty red white and blue foil, and we buy it every time while they laugh at our stupidity and misery and use their get out of jail free cards. And if you think they don't, then you are even dumber than those lost souls who think we're bringing democracy to the world.

[FredOCal]

Nice post. Glass-Steagall was repealed in 1999, when most people who lived through the Great Depression as adults were gone. Now we're about to repeat that mess, but at a far greater cost due to the massive debt levels of both the government and the populace. It's so predictable, it makes me wonder if humans have any free will at all...

[Rule Of Law]

It's just like kids in school cheating and saying, "Well, everybody else does it!"

There's no difference between this Administration and a Crack Dealer. The same soulless preying upon the weakest and most defenseless of our citizens--one sells poison in a powder or a rock, the other sells fear, suspicion, anger and doubt.

The ultimate tragedy of it is that WE believe these pushers when they tell us they have the answer. And WE line up to go off and die in some backwater country while they spend the profits from our blood on vacations in Canne, or Aruba! We're stupid. We're ignorant. We're gullible. And when they come to sell us the next war to enrich the Elites, we'll do it all over again. We'll wave the flag, shout hooah, semper fi, and run off to--to what? To die for some Investment bank or Military weapons manufacturer, or oil company? To come home missing an arm or leg or sanity for some Liars in the White House?

At least a crack dealer will do time if caught. But our "Leaders" and top 1%ers can sell us their totally bogus patriotic crack, wrapped in pretty red white and blue foil, and we buy it every time while they laugh at our stupidity and misery and use their get out of jail free cards. And if you think they don't, then you are even dumber than those poor lost souls who think were bringing democracy to the world.

[VoiceofV]

Truer words were never spoken, but also rarely heard and even more rarely understood by the millions of willfully ignorant among us.

Those that would manipulate, and the weak minded and weak willed masses that would ignorantly follow them, they are the most certain danger to us all.

[instagladiator]

And we should be surprised by this?

[Christopher1]

They don't care or listen all they do is keep begging for more money

[Hoelder]

Did I hear "fired"? No, of course not. We get fired for making up the costly mistakes of the chiefs. Shouldn't we be in charge since we bear the major risks?

[Podewumun]

Always listen to your risk management officer.