Wednesday, October 1, 2008

Irony

I promise...this is the last time I'll get riled up today. We'll do something fun later this afternoon...

Here is a quick look into 3 former Fannie Mae executives who have brought down Wall Street.

Franklin Raines was a Chairman and Chief Executive Officer at Fannie Mae. Raines was forced to retire from his position with Fannie Mae when auditing discovered severe irregulaties in Fannie Mae's accounting activities. At the time of his departure The Wall Street Journal noted, " Raines, who long defended the company's accounting despite mounting evidence that it wasn't proper, issued a statement late Tuesday conceding that "mistakes were made" and saying he would assume responsibility as he had earlier promised. News reports indicate the company was under growing pressure from regulators to shake up its management in the wake of findings that the company's books ran afoul of generally accepted accounting principles for four years." Fannie Mae had to reduce its surplus by $9 billion.
Raines left with a "golden parachute valued at $240 Million in benefits. The Government filed suit against Raines when the depth of the accounting scandal became clear. Housingdoom.com . The Government noted, "The 101 charges reveal how the individuals improperly manipulated earnings to maximize their bonuses, while knowingly neglecting accounting systems and internal controls, misapplying over twenty accounting principles and misleading the regulator and the public. The Notice explains how they submitted six years of misleading and inaccurate accounting statements and inaccurate capital reports that enabled them to grow Fannie Mae in an unsafe and unsound manner." These charges were made in 2006. The Court ordered Raines to return $50 Million Dollars he received in bonuses based on the miss-stated Fannie Mae profits.

Tim Howard - Was the Chief Financial Officer of Fannie Mae. Howard "was a strong internal proponent of using accounting strategies that would ensure a "stable pattern of earnings" at Fannie. In everyday English - he was cooking the books. The Government Investigation determined that, "Chief Financial Officer, Tim Howard, failed to provide adequate oversight to key control and reporting functions within Fannie Mae,"
On June 16, 2006, Rep. Richard Baker, R-La., asked the Justice Department to investigate his allegations that two former Fannie Mae executives lied to Congress in October 2004 when they denied manipulating the mortgage-finance giant's income statement to achieve management pay bonuses. Investigations by federal regulators and the company's board of directors since concluded that management did manipulate 1998 earnings to trigger bonuses. Raines and Howard resigned under pressure in late 2004.
Howard's Golden Parachute was estimated at $20 Million!

Jim Johnson - A former executive at Lehman Brothers and who was later forced from his position as Fannie Mae CEO. A look at the Office of Federal Housing Enterprise Oversight's May 2006 report on mismanagement and corruption inside Fannie Mae, and you'll see some interesting things about Johnson. Investigators found that Fannie Mae had hidden a substantial amount of Johnson's 1998 compensation from the public, reporting that it was between $6 million and $7 million when it fact it was $21 million." Johnson is currently under investigation for taking illegal loans from Countrywide while serving as CEO of Fannie Mae.
Johnson's Golden Parachute was estimated at $28 Million.

WHERE ARE THEY NOW?
FRANKLIN RAINES? Raines works for the Obama Campaign as Chief Economic Advisor
TIM HOWARD? Howard is also a Chief Economic Advisor to Obama
JIM JOHNSON? Johnson hired as a Senior Obama Finance Advisor and was selected to run Obama's Vice Presidential Search Committee

IF OBAMA PLANS ON CLEANING UP THE MESS - HIS ADVISORS HAVE THE EXPERTISE - THEY MADE THE MESS IN THE FIRST PLACE. Would you trust the men who tore Wall Street down to build the New Wall Street ?

21 comments:

Mrs. Newlywed said...

You and I are on the same page. 100%.

It is all making me sick.

In other news, I am reading the book on which I am assuming your blog title is named. My friend gave it to me to read...which is interesting, because I am not pregnant nor with children...

Liza said...

That was VERY interesting and info I did not know. Thank you for sharing!

Amy said...

Wow. I have no words. As for the previous post, I am embarassed to be a Missourian. Can you guys take me in Virginia? :-)

pinkpolkadotaa said...

How interesting!!!

The Roaming Southerner said...

Wow, I just forwarded this post to everyone I know. WOW!

Anonymous said...

Couple of things-- I hope everything is ok. I really enjoy reading your blog & was troubled by yesterday's post.
Re. the Obama stuff... hate to say it, but I think this is propaganda. I just spent 20 min. reading about it from various sources on the internet. (I am a registered independent & am currently an undecided voter. I just hate the smears/propaganda/inflamatory stuff on BOTH sides. Here's another point of view:
http://news.aol.com/political-machine/2008/09/20/ex-fannie-ceo-raines-not-obama-advisor/4

I'm not saying Obama's perfect... he's just not the devil, either. Same for McCain.

Anyway, good luck with everything. Thanks for a great blog.
-Betsey

High on Hairspray said...

Preaching to the choir!! I sell real estate!!

Anonymous said...

Definitely don't want to start a political war because I really, really like your blog. However, WA Post printed an article on Franklin Raines stating that there is absolutely no proof of an Obama connection. See http://voices.washingtonpost.com/the-trail/2008/09/19/_the_ad_obama_has.html

More evidence this is simply internet myth:

http://www.snopes.com/politics/obama/fanniemae.asp

Please know that I'm not saying this to inflame any war. Just wanted you to know the truth in case you want to retract.

I do love your blog!

ms. mindless said...

Hiya Sippycups! I am glad you are back and posting. I usually don't get involved in political debates, especially online, but you should check out this article in the Washington Post from Saturday about this issue.

http://www.washingtonpost.com/wp-dyn/content/article/2008/09/19/AR2008091903604.html

Have a great day!!!

Muffy said...

I love when you get all riled up! HAHAHA! This is great info! I had no idea! SHOCKING!

Barefoot in the Park said...

i hand't heard this...thanks for sharing! i enjoyed your "wednesday rant" :)

Mom x 2 said...

http://www.snopes.com/politics/obama/fanniemae.asp

Mom x 2 said...

http://www.snopes.com/politics/obama/fanniemae.asp

I'm not trying to get into an argument with you on your blog - you're obviously entitled to post whatever you wish. And I don't want to be in the position of defending Barack Obama, a person I'm not particularly fond of. But to copy and paste an email that is not really truthful isn't doing anyone still trying to decide on this election any favors.

seanna said...

that is amazing...i'm emailing this to my democratic brother that's interning on Capitol Hill right now :)

love your blog!

Surf Girl said...

I hear ya! I couldn't believe when I read about the severance package for the CEO of Washington Mutual. Hello....his bank failed!!! His parachute should not be golden, it should fail!

Beav's Wife said...

SING IT SISTER! I couldn't agree more!

magnolia mama said...

Very very interesting! Thanks for sharing.

angie and the boys said...

I love your blog and agree with you on many levels. However, I received this Obama/Fannie Mae story in an email today and checked it out on snopes.com. They say the information is false. I thought you may want to know.

Anonymous said...

All the big Franklin Raines-Fannie Mae-Freddie Mac- ties to Obama are true. They're really trying to fool the public and backpeddle now. Obama was the 2nd highest recepient of Fannie Mae money, after just a few years in the senate, and 2nd only to Senator Dodd. There is a video out there of former Fannie Mae head thanking the Congressional Black Caucus (Obama is present) calling them "family." You just can't imagine all the stuff that is out there that isn't being reported. Thank God for the internet and Fox News.

Karen said...

This has me really fired up!! Thank you for sharing...I wish information like this would get noted in the media. I'm forwarding this info on to others.

Karen

Susan said...

Why can't liberal Democrats read history and understand how we got here?? I am w/ you here. Try telling this to an Obama supporter and it's like talking to the wind.

PS We were just in W'burg (sister in law lives in Fords Colony). Had peanut soup @ Kings Arms Tavern. ahhh.