Former FHFA Head Takes New Job Close to Home – Good Thing In Case He Gets Subpoenaed

September 5, 2014

According to a Bloomberg article published yesterday, former head of the Federal Housing Finance Agency (FHFA) Edward J. DeMarco is now a senior fellow at the Milken Institute’s Center for Financial Markets. Congratulations, Mr. DeMarco, on your new job. It’s a good thing he’ll be working out of the Washington, D.C., office because, in the event he gets subpoenaed to testify about the illegality of the Third Amendment Sweep, cross-country flights can be mighty expensive.

Fannie Mae and Freddie Mac investors are no doubt familiar with Mr. DeMarco’s actions while he was overseeing the mortgage giants after the 2008 financial crisis. It was under his “leadership” that the U.S. Treasury enacted the sweep and started gobbling up investor profits.

The federal judge overseeing the Fairholme lawsuit recently ruled that the government must stop heavily redacting the documents it’s producing in the case’s discovery phase. While it remains to be seen what kind of information eventually gets produced regarding discussions of changing the conservatorship from a 10 percent coupon to a 100 percent one, suffice to say, it will be interesting to see how involved Mr. DeMarco was in the decision to enact the sweep in a stunning violation of the rule of law.