Friday, September 23, 2011

Federal Government's Housing Inspector General Under Fire: Olick

Again another reason why they should be privatized and be regulatory agency at best.
Given that the conservator of Fannie Mae and Freddie Mac, the Federal Housing Finance Agency (FHFA) has been wielding incredible power of late in deciding how much the two mortgage giants can and cannot charge in guarantee fees and whom they can and cannot refinance, it was particularly disturbing to learn the that same FHFA has been deemed, dare I say it, incompetent, at least in one of its oversight capacities.
FHFA-OIG has identified shortfalls in the Agency's examination coverage, particularly in the areas of Real Estate Owned (REO) and default-related legal services," the report begins. Translation: "Robo-signing" paperwork issues.
"FHFA has too few examiners overall to ensure the efficiency and effectiveness of its examination program," the report continues. Apparently just about a third of the FHFA's 120 non-executive examiners are accredited federal financial examiners, and there is nothing in the works there to "improve this condition."
But wait, there's more: "FHFA, to its credit, has sought to address these challenges. Although this is a positive response, FHFA has expressed concern that its current hiring initiative will neither enable it to overcome its examination capacity shortfalls nor ensure the effectiveness of its 2011 reorganization."
Read it all

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