A close associate of Bill Pulte, the former top housing regulator under the Trump administration, shared non-public mortgage pricing information from Fannie Mae with a rival firm. This action alarmed high-ranking executives at the government-backed mortgage lender, who expressed concerns that it could lead to accusations of the company conspiring with a competitor to manipulate mortgage rates.
TL;DR
- Fannie Mae executives alarmed by sharing of private, competitive mortgage pricing information with Freddie Mac.
- Concerns raised that sharing information could lead to accusations of manipulating mortgage rates.
- Senior Fannie Mae executives and ethics investigators challenging Pulte's actions were dismissed.
- Bill Pulte accused of using his role for political objectives and to gain favor with President Trump.
Emails reviewed by The Associated Press show that Fannie Mae executives were unnerved about what one called the “very problematic” disclosure of data by Lauren Smith, the company’s head of marketing, who was acting on Pulte’s behalf.
“Lauren, the information that was provided to Freddie Mac in this email is a problem,” Malloy Evans, senior vice president of Fannie Mae’s single-family mortgage division, wrote in an Oct. 11 email. “That is confidential, competitive information.”
The email, which had the subject line: “As Per Director Pulte’s Ask.”, was also sent to Fannie Mae’s CEO, Priscilla Almodovar. Evans inquired of Fannie Mae’s chief legal counsel “to weigh in on what, if any, steps we need to take legally to protect ourselves now.”
Although Smith remains in her role, the senior Fannie Mae executives who challenged her actions were all dismissed from their positions at the end of last month, alongside internal ethics investigators looking into Pulte and his associates.
Housing industry rattled by dismissals
The firings caused a stir in the real estate sector and were met with disapproval from Democrats. Additionally, it provided Pulte's detractors with proof to back their assertions that he has exploited the private information accessible to him for his own political objectives.
Massachusetts Senator Elizabeth Warren, the top Democrat on the Senate Banking Committee, stated, "“This is another example of Bill Pulte weaponizing his role to do Donald Trump’s bidding, instead of working to lower costs amidst a housing crisis,”". “His behavior raises significant questions, and he needs to be brought in front of Congress to answer them.”
This episode represents the most recent instance of Pulte leveraging a usually understated role within the federal government to boost his own reputation and attract President Trump's notice. He’s prompted mortgage fraud investigations of well-known Democrats who are among the president's most recognized adversaries, such as Sen. Adam Schiff from California, New York Attorney General Letitia James, and California Rep. Eric Swalwell.
In June, he ordered Fannie Mae and Freddie Mac to draft a proposal for companies to accept cryptocurrency, an industry Trump has also promoted, as a condition for purchasing mortgages from financial institutions. The previous week, he persuaded Trump about the allure of a 50-year mortgage as a method to boost home purchases and construction, a suggestion that faced considerable backlash due to its potential to significantly inflate the total cost of a loan.
Pulte is also targeting the nation’s largest homebuilders
Pulte has also concentrated on substantial home builders, who have provoked Trump's anger. Pulte sought private Fannie Mae information and has indicated publicly that he's contemplating stricter measures if these firms don't boost their building output.
“I’m looking at the Fannie Mae builder data and with the top three homebuilders we buy EASILY over $20 billion in THEIR LOANS!” He posted to X in early October.
The Federal Housing Finance Agency, headed by Pulte, issued a short statement that didn't answer AP questions, but indicated the agency “requires its regulated entities to carry out their operations in compliance with all applicable laws and regulations.”
Fannie Mae stated that it requires “compliance with the law very seriously and we have a rigorous program to ensure we follow all laws and regulations.”
Pulte and Smith did not respond to requests for comment.
Currying favor with the president
Following his selection to head the FHFA, Pulte has worked to gain favor with Trump. The 37-year-old heir to a homebuilding fortune, Pulte has established himself as a highly visible millennial eager for acknowledgment and keen to impress the president. Campaign finance records also indicate that he and his spouse contributed approximately $1 million to Trump’s campaign.
When Trump sought to oust Federal Reserve chair Jay Powell, Pulte became a leading attacker, routinely taking to X, formerly Twitter, where he has over 3 million followers, to excoriate the central bank leader.
This week, The Wall Street Journal reported that certain Fannie Mae ethics and oversight personnel, dismissed last month, had been looking into whether Pulte improperly acquired mortgage details for James. James faced bank fraud charges last month after Pulte submitted a criminal referral to the Justice Department. She asserts the accusations, which she refutes, are politically driven.
Pulte’s power over the mortgage lending industry is unusual. Not long after his Senate confirmation, he appointed himself chairman of both Fannie Mae and Freddie Mac, which hold trillions of dollars in assets. The companies serve as a crucial backstop for the home lending industry by buying up mortgages from individual lenders, which are packaged together and sold to investors.
Emails examined by the AP reveal that the three competing roles could create a conflict of interest. As with numerous public policy issues in Washington during Trump's presidency, it seems to have originated from a social media update.
During October, Trump voiced his disapproval of the homebuilding sector, comparing it to OPEC, the cartel that controls the oil market.
“They’re sitting on 2 million empty lots, A RECORD,” the president posted to his social media platform, Truth Social. “I’m asking Fannie Mae and Freddie Mac to get Big Homebuilders going.”
“On it,” Pulte posted in response on X.
Sensitive data was gathered
Pulte consulted Smith, who had emerged as a trusted Pulte supporter during her short time at Fannie Mae, with her responsibilities extending beyond Fannie Mae, Freddie Mac, and the FHFA, according to two individuals who requested anonymity due to concerns about retaliation.
Emails reviewed by the AP indicate that a Fannie Mae team was soon tasked with compiling a collection of mortgage data. Smith was instrumental in this process, sharing sensitive lender-specific pricing details with Freddie Mac, which subsequently raised concerns at both organizations, as per the emails. A representative for Freddie Mac chose not to comment.
In an Oct. 11 communication to Smith, Fannie Mae mortgage executive Evans included additional individuals on the email thread as they “were involved with this week’s efforts to compile this information” and he desired to “make sure you do not exacerbate this issue.”
Danielle McCoy, Fannie Mae’s general counsel, weighed in, adding that the information Smith provided to Freddie Mac should “never be shared” and “could put the company at risk.”
The email chain also featured Almodovar, the CEO; chief operating officer Peter Akwaboah; Devang Doshi, a senior vice president for capital markets; and John Roscoe, a staunch Almodovar supporter and former Trump White House aide, who held the position of Fannie Mae’s executive vice president of public relations and operations.
A few days passed, and Almodovar, McCoy, and Evans, who were unreachable for comment, found themselves unemployed. Concurrently, Roscoe ascended to the position of company co-president, and Akwaboah was appointed acting CEO.
Pulte also got something he wanted.
The day following their brief email discussion, Trump shared an image on his Truth Social platform. This graphic included the Fannie Mae emblem, names of prominent home construction companies, and the heading “We Give Them Billions.”
Pulte quickly reposted it.