Investors Balk As Billions In Fannie, Freddie Profit Goes Into The Government's Pocket

Mortgage

Fannie Mae and Freddie Mac have been raking in billions in profits as of late, and all of that money is being pocketed by the government — a fact that has investors seething.

The federal government bailed out the mortgage giants in 2008 for $187B, and they have remained under government control since, transfering all profits to the U.S. Treasury despite the fact that the companies are still traded over-the-counter.

Fannie and Freddie’s most recent payments sent $9.9B to the Treasury at the end of March, pushing the total they have payed to taxpayers up to $266B, Bloomberg reports. Several investors want their cut of the money and are taking steps to sue the government, claiming it is illegally confiscating their private property. So far all rulings have defended the government, but hedge fund managers Bill Ackman, founder and CEO of Pershing Square Capital Management, and John Paulson, head of Paulson & Co., have indicated they are going to keep pushing for a slice of the profits.

Those investors have a powerful ally. Treasury Secretary Steve Mnuchin called for privatizing Fannie and Freddie, a move that would ultimately transfer all profits back to investors.

Continue reading this story with a free account

Log in or register
Sign up for more articles like this
Subscribe to Bisnow's National Newsletters
Related Stories

Wall Street Impatient For Big Tech Returns On Data Center Spending

As AI Adoption Ramps Up, Half A Million Property Managers Are In The Crosshairs

Treasuries Hover Around 4.7% As Wall Street Questions If Warsh Is A 'Dove In Hawk's Clothing'

Avison Young Had Assets Frozen By Bank Over Unpaid Taxes

Camden Property Trust Sells West Coast Portfolio, Clears $1.5B Target

Churchill Downs Plans To Sell 9 Casinos, Focus On Horse Racing

Bringing Stability And Savings To CRE Insurance Through Working Layer

More Hotel Owners In Need Of Cash Are Getting It From The Big Brands

Former Arms Dealer Targeting Heartland Apartment Takeover Files For Bankruptcy

SEC Charges REIT, Its Founders With Alleged $152M Fraud Scheme

Equinix Ramps Up Spending Plans Amid Faster-Than-Expected AI Shift

Cortland, Pulte, INVH, Walker & Dunlop Execs Talk Changing Demographics, AI