The watchdog tasked with oversight of the Federal Housing Finance Agency (FHFA) laid out its strategic priorities for the next four years.
Federal Housing Finance Agency Office of Inspector General will carry out oversight to make sure FHFA ensures the safety and soundness of the entities it regulates and is an effective conservator of Fannie Mae and Freddie Mac. It will also deter and detect fraud, waste and abuse, and increase the “integrity awareness” of FHFA employees, which it said it will accomplish, in part, by disseminating a brochure to them.
The inspector general also wants to improve the feedback loop between FHFA leadership, Congress and other stakeholders, and recruit a “diverse, highly skilled, high performing, inclusive workforce.”
In the three months since the Senate confirmed Brian Tomney as inspector general, the office he leads has announced a number of investigations, including into FHFA’s public accountability and how its regulated entities follow up on tenant protections.
Three days after Tomney assumed his role, the watchdog found FHFA fell short of its goal of “public transparency” because its 2020 report to Congress was much lighter on details of the Enterprises’ progress toward scorecard goals than the previous year. Although that is a shortcoming pertaining to the previous administration, current FHFA leadership has not established an alternative reporting procedure. In March, the inspector general said FHFA had promised to develop reporting plans but had not yet made a determination on whether to resume publishing scorecard progress reports.
Also in March, the inspector general assessed how Freddie Mac monitors compliance with tenant protections that the CARES Act and Freddie Mac’s own programs require. It found the GSE does not monitor for those protections, and Freddie Mac and FHFA both said Freddie Mac does not have the authority or ability to directly enforce those protections.
The Cybersecurity and Infrastructure Security Agency (CISA) and the Biden Administration have issued a “Shields Up” warning to U.S. businesses regarding the increased threat of cyberattacks related to Russia’s invasion of Ukraine earlier this year.
Presented by: FundingShield
In November, in its 2022 annual plan, the inspector general said it would audit FHFA’s initiatives in response to Biden’s 2021 racial equity edict, and whether the initiatives were achieving their purpose. The previous inspector general, Phyllis Fong, who was acting inspector general from the end of July 2021 to March, proposed that investigation.
Tomney, who led internal investigations at Capital One prior to taking the FHFA watchdog job, pledged at the time to not be a “paper tiger.” The previous Senate-confirmed FHFA inspector general, Laura Wertheimer, resigned after she was investigated for abusing her authority.
While an inspector general can issue recommendations and public reports and investigate whistleblower complaints, it does not have the power to compel the agency it oversees to take actions.
The inspector general made that point in a foreword to the nearly 50 recommendations it issued, going back as far as 2013, which, as of June 1, it closed without FHFA taking any action.