Fannie-Freddie Judges Hear Investor Claim U.S. Stole Profits

  • Bailout plan amendment captured billions of dollars for U.S.
  • Investors ask appeals court to revive rights to dividends

Lawyers for investors in Fannie Mae and Freddie Mac asked a federal appeals court to at least revive their claims that the U.S. stripped the companies of billions of dollars of profits, depriving shareholders of dividends, if not to go further and rule the transfer of profits to the government was unlawful.

Government attorneys countered that the Federal Housing Finance Agency, which has effectively controlled the mortgage giants since their 2008 bailout, was acting within the authority it was granted by Congress when it implemented the so-called net worth sweep in 2013 that sent the companies’ profits to the U.S. Treasury Department. They also argued that without the government’s infusion of almost $190 billion, the companies, which back residential mortgages, would have collapsed…

Fannie-Freddie Judges Hear Investor Claim U.S. Stole Profits

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