Former Top Fannie Mae Execs Grilled On Compensation, Lobbying Of Congress (VIDEO)

Former Top Fannie Mae Execs Grilled On Compensation, Lobbying Of Congress (VIDEO)

Scroll down for video

The panel created by Congress to investigate the roots of the financial crisis grilled former top officials at Fannie Mae on Friday over the tens of millions of dollars they received in compensation and their extensive (and successful) lobbying of Congress.

The firm, along with its corporate cousin, Freddie Mac, were taken over by the federal government in September 2008 after officials determined that the companies did not have enough cash to cover their liabilities and climbing losses.

FCIC Vice Chair Bill Thomas zeroed in on Fannie's lobbying: "Were you ever present at a meting in which there was a discussion about how a particular member of Congress might be approached in attempting to advance the quote-unquote business model of Fannie Mae?"

Robert Levin, former executive vice president and chief business officer at the mortgage behemoth, dodged the question for a few minutes.

He was finally forced to answer the question, which Thomas and FCIC Chair Phil Angelides pressured him to answer with a yes or no response.

"C'mon, yes or no?" Thomas finally snapped.

"Yes," Levin responded.

Fannie had branched out in previous years to buying and insuring billions in riskier types of home mortgages, partly due to political pressure, and partly due to top officials wanting to boost revenue, which led to higher bonuses.

After the housing market collapsed in 2008 and private sources of financing for home mortgages dried up, the federal government, through Fannie, Freddie, and the Federal Housing Administration, stepped in to prop it up. Uncle Sam now enables about nine in 10 new home mortgages.

U.S. taxpayers stand behind trillions of dollars in home mortgages, and will likely lose hundreds of billions. The Obama administration promised to deliver a plan this year on how it will reform the mortgage giants; it punted that decision to next year, after this November's Congressional elections.

While experts and commentators debate the size of the role Fannie and Freddie played in causing the crisis, there's no doubt it was sizable.

The Financial Crisis Inquiry Commission spent Friday speaking with former top officials at Fannie, and their federal overseers.

WATCH Vice Chair Bill Thomas grill a former top Fannie executive:

WATCH Vice Chair Bill Thomas question former Fannie executives on their lobbying of Congress:

Popular in the Community

Close

What's Hot