Senate wants changes to Fannie, Freddie executive pay
A bipartisan group of 60 senators sent a scathing letter to the Federal Housing Finance Agency and the Treasury Department demanding a crack down on executive pay at Fannie Mae and Freddie Mac. Regulators approved $13 million in bonuses to 10 employees at the mortgage giants, according to Securities and Exchange Commission filings at the beginning of the year. Both firms received a combined $169 billion in federal bailouts. Both the Senate Banking and the House Government Accountability and Oversight committees scheduled hearings over the issue. "Such excessive compensation seems wildly imprudent," the letter reads. Sens. Mark Begich (D-Alasksa) and John Thune (R-S.D.) led the decision to send the letter to FHFA Acting Director Edward DeMarco and Treasury Secretary Tim Geithner. Thirty-five Republicans and 25 Democrats signed it, turning the outrage into one of the most cooperative efforts of this oft-gridlocked assembly. "The idea that Fannie Mae and Freddie Mac, which rely on taxpayer funding to stay afloat, must offer excessive bonuses to its executives to attract effective management strains credulity," the senators wrote. They urged the FHFA and the Treasury to make "substantial changes" to executive pay policies and asked for updates on reforms of certain compensation packages. According to an FHFA Inspector General report released in March, the top six executives at both Fannie and Freddie made a combined $35.4 million in 2009 and 2010. Executive pay and possible bonuses for 2012 have not been determined yet. Write to Jon Prior. Follow him on Twitter @JonAPrior.