Holders of Freddie Mac and Fannie Mae stock were on the hook for losses after the housing crash, but since then, as the government-sponsored enterprises have shaken off the worst of it and turned in profits, those profits have not and are not going to be shared with stockholders.

A Dec. 20, 2010, Treasury Department memo to then-Secretary Timothy Geithner from domestic finance undersecretary Jeffrey Goldstein, said the Obama administration had a “commitment to ensure existing common equity holders will not have access to any positive earnings from the G.S.E.’s (sic) in the future.”

Fannie and Freddie had been bailed out by taxpayers just 28 months prior to the tune of nearly $190 billion.

The U.S. Securities and Exchange Commission requires that all material knowledge and information must be disclosed to shareholders and it’s hard to see how this information doesn’t qualify. As one party to the investor complaint against the Treasury Department put it, “This is essentially government confiscation of private property – something to be expected from Putin or Chavez, but not the U.S. government.” The Treasury declined to comment.

Click here to see the Treasury Department memo.

“People disagree about what should happen to the GSEs….But if the plan is to wind them down, Congress provided a means to do that in the 2008 law — it’s called receivership, and it provides a host of procedural protections to claimants,” said Matthew D. McGill, a lawyer at Gibson, Dunn & Crutcher in Washington who represents Perry Capital, a GSE investor suing for its alleged share of profits.

“What the Treasury cannot do is abuse its conservatorship powers to nationalize the companies and then, when it deems convenient, wind them down without the protections enacted by Congress," McGill added.

According to the New York Times, at the time of the memo, a large number of investors held the stocks in question. The paper says that 18,000 investors held 1.1 billion shares of Fannie Mae common stock, while just over 2,100 investors held 650 million Freddie Mac shares.

As of Sept. 30, 2013, the GSEs returned $185 billion to the Treasury and none to shareholders.

On Tuesday, activist Ralph Nader – no natural ally of investors – sent a letter to Treasury Secretary Jack Lew, a copy of which was obtained by HousingWire.

“What legal authority does the Administration have, as this section of the memo intimates, to completely wipe out shareholders – even after taxpayers have been repaid (as is likely to happen soon)?” Nader writes. “It seems to be setting a precedent for using and abusing the GSEs’ shareholders.”

For a full copy of Nader’s letter, click here.