Bill Pulte’s FHFA mortgage-fraud crusade faces watchdog scrutiny
Rule Changes
Trump’s housing-finance chief used Fannie and Freddie’s tools against political opponents and to push market interventions; now Congress’ watchdog is probing whether the FHFA was turned into a partisan weapon amid GSE privatization push.
Trump’s housing-finance chief used Fannie and Freddie’s tools against political opponents and to push market interventions; now Congress’ watchdog is probing whether the FHFA was turned into a partisan weapon amid GSE privatization push.
In early 2025, President Donald Trump installed housing heir Bill Pulte as director of the Federal Housing Finance Agency (FHFA), the regulator overseeing Fannie Mae, Freddie Mac and more than $8.5 trillion in U.S. mortgage credit. Within months, Pulte began using access to mortgage data to publicly accuse several high-profile Democrats — New York Attorney General Letitia James, Senator Adam Schiff, Federal Reserve Governor Lisa Cook and Congressman Eric Swalwell — of mortgage fraud, referring them to the Justice Department amid concerns of political retribution.
By early 2026, Pulte has expanded FHFA's role into aggressive housing policy, directing Fannie and Freddie to ramp up mortgage bond purchases to $225 billion to pressure rates lower, while backing away from a controversial 50-year mortgage idea and promoting GSE privatization — moves drawing criticism for risks to taxpayers and markets. Senate Democrats' November 2025 request led to a December GAO probe into Pulte’s conduct, including bypassing the FHFA inspector general; with no resolution over a year later, the saga tests whether housing regulators can pursue fraud crackdowns, market interventions and privatization without partisan taint.
Since his March 2025 confirmation, Pulte has formally referred New York Attorney General Letitia James, Senator Adam Schiff, Federal Reserve Governor Lisa Cook and Congressman Eric Swalwell to the Justice Department for alleged mortgage fraud — all prominent Trump adversaries, with no equivalent Republican targets publicly identified.[3]
$225B
Fannie/Freddie bond purchase expansion
FHFA under Pulte authorizes GSEs to increase mortgage bond buys from $40B to $225B to exert 'downward pressure' on rates, per Trump directive, raising risk concerns amid conservatorship.[2]
8
Senate Democrats requesting GAO probe
Elizabeth Warren, Dick Durbin and six other Senate Democrats signed the November 17, 2025 letter urging GAO to investigate whether Pulte misused FHFA resources, violated privacy rules, or altered mortgage-fraud procedures to facilitate partisan targeting.
5 years
Length of FHFA director’s term
Pulte was confirmed to a five-year term as FHFA director, meaning removal or forced resignation would require substantial political will or legal findings, raising the stakes of any abuse-of-power determinations.
$8.5T+
Mortgage assets overseen by FHFA
FHFA regulates Fannie Mae, Freddie Mac and the Federal Home Loan Banks, which together provide more than $8.5 trillion in funding to U.S. mortgage markets — making any politicization of the agency a systemic risk issue, not just an ethics story.
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Jane Addams
(1860-1935) ·Progressive Era · social reform
Fictional AI pastiche — not real quote.
"How swiftly the machinery of government turns from securing shelter for the common family to settling scores among the powerful—while the actual question of whether working people can afford a roof over their heads becomes mere backdrop to a regulatory theatre where accusations fly more freely than mortgage assistance ever did."
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People Involved
William J. (Bill) Pulte
Director, Federal Housing Finance Agency; Chair of Fannie Mae and Freddie Mac Boards (Under GAO investigation; directing GSE bond buys and privatization push amid ongoing fraud referral controversy)
Donald Trump
President of the United States (Backs Pulte’s efforts including GSE privatization and bond purchases; political patron of FHFA mortgage-fraud campaign)
Elizabeth Warren
U.S. Senator (D‑Mass.); Ranking Member, Senate Banking Committee (Leads congressional push for GAO investigation into Pulte)
Letitia James
Attorney General of New York (Subject of Pulte‑driven mortgage‑fraud case; grand jury recently declined re‑indictment)
Adam Schiff
U.S. Senator (D‑Calif.) (Under DOJ mortgage‑fraud investigation following Pulte referral; not indicted)
Lisa D. Cook
Governor, Federal Reserve Board of Governors (Fighting Trump’s attempt to remove her; under DOJ review after Pulte referral)
Organizations Involved
FE
Federal Housing Finance Agency (U.S. Federal Housing)
Government Body
Status: Regulator at center of politicization, oversight fight and housing policy shifts including GSE bond expansion
FHFA is the U.S. regulator and conservator for Fannie Mae and Freddie Mac and the regulator of the Federal Home Loan Bank System, responsible for the safety and soundness of entities that fund more than $8.5 trillion in U.S. mortgage markets.
U.
U.S. Government Accountability Office
Oversight Agency
Status: Conducting investigation into FHFA Director Bill Pulte
GAO is Congress’ nonpartisan watchdog, tasked with auditing federal programs, evaluating agency performance and investigating potential misuse of public funds or authority.
FA
Fannie Mae (Federal National Mortgage Association)
Government-Sponsored Enterprise
Status: Executing FHFA-directed bond purchase expansion to $225B; target of Pulte-led privatization talks
Fannie Mae is a government‑sponsored enterprise (GSE) that buys and guarantees mortgages, operating under FHFA conservatorship since 2008. Its internal fraud and quality‑control units produced memoranda later cited in political attacks.
FR
Freddie Mac (Federal Home Loan Mortgage Corporation)
Government-Sponsored Enterprise
Status: Executing FHFA-directed bond purchase expansion to $225B; target of Pulte-led privatization talks
Freddie Mac is a GSE that purchases and guarantees mortgages, operating under FHFA conservatorship and subject to the same oversight dynamics as Fannie Mae.
Timeline
Alaska Public Media Warns of Risks in Pulte's Fannie/Freddie Privatization Push
Policy Debate
Article highlights FHFA Director Pulte's promotion of privatizing Fannie Mae and Freddie Mac, alarming critics over market risks, higher mortgage rates and benefits to Trump donors, while noting Pulte's controversial self-appointment as GSE chairman and past fraud accusations against opponents like Lisa Cook.
FHFA Expands GSE Mortgage Bond Purchases to $225 Billion Under Pulte
Regulatory Action
Pulte directs Fannie Mae and Freddie Mac to increase bond buying from $40B to $225B — far exceeding Trump's $170B instruction — to lower home loan rates, sparking concerns over riskier portfolios and lack of consultation with Treasury.
Pulte Backs Away from 50-Year Mortgage Proposal
Policy Reversal
FHFA Director Pulte states Trump is reviewing 30-50 housing cost ideas but drops the panned 50-year mortgage he had pitched; confirms GSEs starting $200B bond buys per Trump order and defends fraud referrals as non-partisan.
Detroit Free Press Highlights GAO Probe into Pulte
Media Coverage
The Detroit Free Press reports that the congressional watchdog’s investigation into FHFA Director Bill Pulte will examine whether he abused his position and misused government resources, adding hometown and political context to the growing national scrutiny of his conduct.
GAO Opens Investigation Into FHFA Director Bill Pulte
Investigation
GAO notifies Senate Democrats that it will investigate whether FHFA Director Bill Pulte and his staff abused their power by using agency resources and mortgage data to target Trump’s political adversaries, including James, Schiff, Cook and Swalwell. GAO says it will coordinate with FHFA’s acting inspector general and has not set a timeline.
Grand Jury Declines to Re‑Indict Letitia James
Legal Turning Point
A federal grand jury in Virginia refuses DOJ’s attempt to re‑indict New York AG Letitia James on revised mortgage‑fraud charges after a judge dismissed the original case over an unlawfully appointed prosecutor. The rare move intensifies criticism that the prosecution, triggered by Pulte’s referral, is weak and politically motivated.
Warren and Senate Democrats Ask GAO to Investigate Pulte
Oversight Request
Senator Elizabeth Warren and seven other Democrats formally request that GAO investigate whether Pulte and FHFA staff misused federal authority and resources, violated privacy laws, or changed mortgage‑fraud standards to facilitate partisan targeting of Trump’s opponents.
Senate Democrats Accuse Pulte of Abusing FHFA Power
Congressional Oversight
Six Senate Democrats send Pulte a letter accusing him of abusing his authority as FHFA director to attack Trump’s perceived adversaries, highlighting his focus on James, Schiff and Cook while declining to scrutinize comparable allegations involving Republican officials and Trump cabinet members. They demand documents on his investigations and internal processes.
Pulte Rejects 'Political Weaponization' Label on CNBC
Public Statement
In a combative CNBC interview, Pulte repeatedly declines to explain where he got the 'tip' underlying his accusations against Lisa Cook, saying he will not discuss 'sources and methods.' Pressed about perceptions that his actions are politically driven, he insists he is simply enforcing mortgage rules.
LA Times Exposes Pulte’s Broader Campaign Against Trump Foes
Investigative Reporting
The Los Angeles Times publishes a detailed profile describing Pulte, a Trump donor turned regulator, as leading an unprecedented effort to mine mortgage records for possible missteps by Letitia James, Adam Schiff, Lisa Cook and Eric Swalwell, while ignoring similar issues involving Trump cabinet members and even Pulte’s own relatives.
Pulte Targets Fed Governor Lisa Cook With Fraud Referral
Legal Action
Pulte alleges that Federal Reserve Governor Lisa Cook claimed two different homes as primary residences in 2021 and misused a second‑home designation on a third property, and says he has submitted a criminal referral to DOJ. Trump responds by demanding her resignation and later attempts to fire her 'for cause'; Cook refuses to step down and insists she did nothing wrong.
Trump Publicly Accuses Senator Adam Schiff of Mortgage Fraud
Public Statement
Citing an internal Fannie Mae memo transmitted to Pulte, Trump accuses Senator Adam Schiff of mortgage fraud for allegedly misrepresenting his primary residence between homes in Maryland and California. Schiff rejects the claims as political retaliation and notes that the Fannie memo did not actually conclude he committed fraud.
Pulte Refers New York AG Letitia James for Mortgage-Fraud Prosecution
Legal Action
Pulte sends a letter to Attorney General Pam Bondi alleging that New York AG Letitia James misrepresented an investment property as her primary residence, misstated unit counts and mischaracterized a familial relationship on loan documents, and urges DOJ to investigate her for mortgage and bank fraud. James calls the allegations retaliation for her work against Trump.
Pulte Sworn In, Vows a 'Golden Age' of Housing
Public Statement
At agency headquarters, Pulte is sworn in as the fifth FHFA director. In prepared remarks, he promises a 'Golden Age of housing and mortgage accessibility' and pledges to keep markets 'safe and sound' while expanding homeownership.
Senate Confirms Pulte as FHFA Director
Confirmation
The U.S. Senate votes 56–43 to confirm William Pulte as FHFA director for a five‑year term. Industry associations congratulate him and emphasize his role in addressing housing affordability and charting a path out of GSE conservatorship.
Trump Nominates Bill Pulte to Lead FHFA
Appointment
President‑elect Donald Trump announces Bill Pulte as his pick to direct the Federal Housing Finance Agency, drawing praise from homebuilder and mortgage‑industry groups that expect him to focus on ending Fannie and Freddie’s conservatorships and boosting housing supply.
Scenarios
1
GAO Finds Serious Abuse; Pulte Is Forced Out or Sharply Curbed
Discussed by: Senate Democrats, legal commentators, watchdog groups, and some financial‑regulation analysts
Under this scenario, GAO concludes that Pulte systematically misused FHFA resources and confidential mortgage data to target political opponents, bypassing the inspector general and violating internal controls or privacy protections. Such findings could fuel calls for his resignation, bipartisan pressure on Trump to fire him, or even impeachment‑style proceedings for an agency head. Congress might push statutory changes to clarify that FHFA cannot conduct politically sensitive criminal referrals without IG involvement, and to reinforce privacy and data‑access safeguards. The outcome would resemble prior cases where intensive oversight, even without criminal charges, led to leadership changes and institutional reforms.
2
GAO Criticizes Processes but Pulte Survives, Norms Erode
Discussed by: Some nonpartisan think tanks, former regulators quoted in major outlets, and political handicappers
GAO could issue a nuanced report faulting FHFA for weak governance, unclear lines between supervisory work and prosecutions, or poor documentation, while stopping short of declaring Pulte’s actions unlawful or overtly partisan. The White House would likely claim vindication and keep him in place, perhaps with cosmetic policy tweaks or new guidelines for interactions with DOJ. This would normalize a more overtly political role for FHFA and other regulators, signaling that aggressive use of confidential financial data against opponents is tolerable so long as it is legally colorable, even if highly selective.
3
Backlash Spurs Broader Anti‑Weaponization Reforms
Discussed by: Good‑government organizations, some centrist lawmakers, and editorial boards drawing parallels to past politicization scandals
GAO’s probe, combined with controversies over DOJ’s handling of the James and Schiff cases, could catalyze a broader legislative response. Congress might bolster inspectors general, codify rules for when regulators can make criminal referrals, or limit how agencies share sensitive financial data about elected officials. Reforms could mirror post‑Watergate and post‑IRS‑targeting changes, creating clearer guardrails against using tax, housing‑finance or banking powers as political cudgels. Even if Pulte remains in office, his tenure could become a case study that drives stronger separation between technical regulators and partisan fights.
4
Investigations Stall or Fizzle, Pulte’s Narrative Gains Traction
Discussed by: Pro‑Trump media, some administration allies, and skeptical commentators about congressional investigations
It is possible that GAO’s work drags on without clear conclusions, DOJ declines to charge anyone over alleged abuses inside FHFA, and courts uphold Trump’s contested moves against targets like Lisa Cook. Pulte and his allies would argue that the absence of criminal findings proves his campaign was a legitimate anti‑fraud effort and that critics engaged in a partisan smear. That outcome would embolden similar efforts to use regulatory data against opponents in the future, and reinforce perceptions among Trump supporters that watchdogs are themselves politicized.
Historical Context
Nixon’s 'Enemies List' and Use of Federal Agencies
1971–1974
What Happened
During Richard Nixon’s presidency, White House aides compiled an 'enemies list' of political opponents and discussed using federal machinery — particularly the IRS and other investigative tools — to 'screw' those adversaries. Memos and later testimony revealed efforts to trigger tax audits and other forms of harassment, which became part of the broader Watergate narrative about abuse of presidential power.
Outcome
Short Term
The revelations contributed to congressional investigations, public outrage and a perception that the administration had turned ostensibly neutral agencies into political weapons.
Long Term
Post‑Watergate reforms strengthened oversight of intelligence and law‑enforcement agencies and reinforced norms against using the IRS or other regulators for partisan retaliation, though later controversies show those norms remain vulnerable.
Why It's Relevant Today
The Pulte saga echoes Nixon‑era concerns about using obscure bureaucratic levers — in this case FHFA and mortgage data — to target named political enemies. How aggressively Congress and watchdogs respond will test whether post‑Watergate safeguards still deter such behavior or whether new tools are needed for the age of data‑rich financial regulators.
2013 IRS Targeting Scandal (Lois Lerner)
2010–2015
What Happened
In the early 2010s, the IRS’s Exempt Organizations division used politically loaded search terms, including 'Tea Party' and 'Patriot,' to flag certain nonprofit applicants for extra scrutiny. In 2013, division head Lois Lerner acknowledged the conduct and apologized. The Treasury inspector general and congressional investigators found that conservative groups were systematically singled out, leading to hearings, Lerner’s resignation and a formal IRS apology as part of a court settlement.
Outcome
Short Term
The scandal triggered multiple investigations, a leadership shake‑up at the IRS, and intense partisan conflict over whether the Obama administration had weaponized tax enforcement.
Long Term
While no senior officials were criminally convicted, the episode damaged trust in the IRS and spurred procedural changes and heightened sensitivity to using enforcement filters that correlate with ideology. It remains a touchstone in debates over 'weaponization' of the administrative state.
Why It's Relevant Today
Pulte’s FHFA campaign similarly raises questions about whether a technical agency, armed with privileged financial data, is being directed to focus on one political faction. The IRS case shows that even without criminal findings, perceived selective enforcement can have enduring political costs and prompt structural reforms.
2006 Dismissal of U.S. Attorneys for Political Reasons
2006–2010
What Happened
In 2006, the George W. Bush administration abruptly dismissed several U.S. attorneys mid‑term. Subsequent investigations found that political considerations — including pressure to pursue voter‑fraud and public‑corruption cases aligned with Republican priorities — had influenced the firings. A Justice Department inspector general report later described the process as 'arbitrary' and 'fundamentally flawed,' raising doubts about the integrity of prosecution decisions.
Outcome
Short Term
The scandal led to intense congressional scrutiny, the resignation of Attorney General Alberto Gonzales and reputational damage to DOJ, though prosecutors ultimately declined to bring criminal charges over the firings.
Long Term
The episode reinforced norms against overtly partisan manipulation of prosecutorial appointments but also highlighted the limits of legal remedies when political actors exploit structural discretion for partisan ends.
Why It's Relevant Today
Pulte’s alleged bypassing of the FHFA inspector general and orchestration of politically sensitive referrals to DOJ resembles earlier attempts to bend prosecutorial mechanisms toward partisan aims. The U.S. attorney firings case suggests GAO and IG reports can force leadership changes and reforms even absent criminal convictions, but may not fully deter future attempts at politicization.
