Monday, October 12, 2009

Fannie Mae document drop reveals an unbelievable level of slime

If you have interest in what helped precipitate the mortgage meltdown of 2008, one need only examine the actions of the government-sponsored entity Fannie Mae. As an indirect buyer and packager of subprime loans, Fannie trafficked in hundreds of billions in toxic financial products.

The level of corruption exhibited by Fannie Mae's management in the early 21st century almost defies description. During this time, Fannie suffered a $10 billion accounting scandal, an ominous harbinger of the firm's subprime troubles.

Leading Fannie Mae: Clinton-era operatives Franklin Raines, Jamie Gorelick and Jim Johnson (also an Obama adviser), who carted off hundreds of millions in compensation, much of it through an Enron-like accounting scam.

How did the accounting fraud occur? Fortunately, a document drop by the law firm of Katz, Marshall & Banks reveals the findings of a Fannie Mae accountant-turned-whistleblower named Roger Barnes. KMB has released both its letter to Senator Warren Rudman and pertinent exhibits (PDF).

The highlights are truly shocking:

I would encourage you to read the entire letter. The brazen fraud perpetrated by Fannie's management -- consisting of all loyal Democrat party hacks and Clintonistas -- is shocking in its scope.

And how do all of these findings fit into the Obama meme that the meltdown was all President Bush's fault? It doesn't, of course.

Which means you won't hear about any of these documents -- and the truth behind the mortgage meltdown -- except perhaps on Fox News.

Hat tip: Karl Denninger.

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