Ethics Inquiry into Fannie Mae Officers Over Mortgage File Access

Ethics officials at Fannie Mae were removed from their positions as they were investigating whether a high-ranking official from the Trump administration improperly accessed sensitive mortgage documents belonging to New York Attorney General Letitia James and other Democratic officials.

This comes after William Pulte, head of the Federal Housing Finance Agency, accused James, California Senator Adam Schiff, and Federal Reserve Governor Lisa Cook of mortgage fraud. These accusations have been widely denied by the officials involved, and experts suggest that the referrals are part of a politically motivated strategy to target opponents of Trump.

The Wall Street Journal reported that Fannie Mae's ethics and internal investigations team received complaints indicating that senior officials at the FHFA had directed employees to access these mortgage documents.

Following this, the investigation was escalated to the inspector general's office and then forwarded to the U.S. Attorney for the Eastern District of Virginia, who was recently appointed by Trump. Lindsey Halligan, the newly appointed U.S.

Attorney, reportedly expressed dissatisfaction with receiving this information, as it could be required for legal discovery involving James's lawyers. Halligan later denied forwarding any information to the White House, calling it a mischaracterization.

In a related development, Joe Allen, who was acting inspector general, was asked to resign, leaving the position currently vacant. Additionally, about a dozen staff members from Fannie Mae's ethics and internal investigations teams were terminated last month, which included the agency's chief ethics officer, Suzanne Libby.

Danielle McCoy, the general counsel for Fannie Mae, also left under pressure. The FHFA has defended its actions, dismissing claims of misconduct as 'Fake News.' This situation raises significant concerns about data privacy and ethical standards in financial institutions, potentially impacting regulatory practices across the banking sector.