Fannie Mae – Judge To Treasury: Turn Over All Discovery Documents

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Fannie Mae – Judge To Treasury: Turn Over All Discovery Documents by Investors Unite

The federal judge overseeing the Fairholme case ruled last week that the U.S. Treasury must release all documents it has concerning the conservatorship of Fannie Mae and Freddie Mac. The ruling from Judge Margaret Sweeney grants a motion filed by Fairholme’s attorneys to force the government to stop withholding documents it claims are protected under privilege or because the contents could impact the markets.

Fairholme’s attorneys have argued that the government is deliberately stonewalling, making it more difficult to get a true understanding of the events and decisions leading up to the Third Amendment Sweep.

HousingWire had a good write-up on this ruling, quoting Rafferty Capital Markets analyst Richard Bove saying it’s a “big win” for the plaintiffs. The article also quoted an earlier ruling from Judge Sweeney that seemed to hint at this ruling:

‘”The evidence needed by plaintiffs to respond to defendant’s jurisdictional allegations is within the hands of defendant, and otherwise not publicly available,’ Sweeney wrote earlier this year. ‘Thus, plaintiffs are entitled to discovery on this issue.’

“‘Therefore, in light of the parties’ dispute over jurisdictional facts and plaintiffs’ apparent lack of sufficient evidence to respond to defendant’s motion to dismiss, plaintiffs are entitled to conduct discovery in order to meet their burden of presenting the proof necessary to establish this court’s jurisdiction.’”

This is a significant ruling that shows Judge Sweeney sees the government telling different courts different things – her court of Federal Claims and Judge Royce Lamberth in the District Court for D.C.

In practical terms, the ruling means Fairholme’s attorneys can bring all of the protected information currently under seal – more than 10,000 pages worth of depositions, documents and whatever else falls under the discovery terms – into the D.C. Circuit without having to keep going back to the judge for decisions on individual components. An excellent Huffington Post piece by PopularEconomics.com editor and publisher Harlan Green says this will finally let shareholders “untangle” what occurred from 2008 to 2012. Noting that the funds the enterprises received have been “paid back in spades and the GSEs are not being allowed to recapitalize,” Green’s post is accompanied by a “Largest Taking In History … And Still Going!” graph, which you really should go check out.

We’re still waiting to see how Judge Sweeney will rule on a motion submitted recently by the New York Times calling for the “protected information” removed from depositions from Edward DeMarco, head of the Federal Housing Finance Agency when the Third Amendment took effect, and Mario Ugoletti, a Treasury official who oversaw the agency’s policy toward the GSEs at the time of the conservatorship and who moved over to FHFA as a Special Advisor to DeMarco.

Ugoletti has said that he played a key role in creating the Preferred Stock Purchase Agreements, which were later amended to become the Sweep. And while it’s not unusual for officials with specific knowledge or experience to move within or between agencies, in this situation, Ugoletti’s moves and statements raise questions as to whether he was acting independently at FHFA, as required of a conservator, or serving as an unofficial agent on behalf of the Treasury.

In the motion, the New York Times asserts its right to intervene in the discovery process as a news organization on behalf of the public, and states that the government has failed to show good cause for the continued confidentiality of the documents. From the motion, with emphasis added:

“The public’s interest in the underlying facts of this case is undeniable … The case directly addresses how the Government is going about recouping public funds used in the bailout and whether other investors are being treated lawfully. The Government should not be able to hide from the public – voters and taxpayers – the facts that were central to the decisions that the Government made as part of the far-reaching effort to safeguard the U.S. economy. To the contrary, access to the evidence will enable the public to understand more fully the decisions the Government has made in the public’s name and to assess the wisdom and effect of those decisions.

“Good cause for continued confidentiality has not been shown here as to the Transcripts. As an initial matter, there is no indication that the Government has even attempted to articulate good cause for the confidentiality, and it cannot avoid its obligation to do so, despite the fact that the protective order currently exists.”

Ugoletti’s interagency communications bear additional scrutiny and documents related to this must be made public. We hope Judge Sweeney rules in favor of this motion as well. After all, the taxpayers who generously bailed out Fannie Mae and Freddie Mac and the shareholders who had their private property seized by their own government deserve to know the truth.

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5 Comments on "Fannie Mae – Judge To Treasury: Turn Over All Discovery Documents"

  1. No David Shanks, the oblivious, clueless, moronic, mind controlled, would be you. Either that or you are in the industry and agree w/the crimes that continue. Go back to your CNBC, CNN, FOxNews, and whatever BS you believe in. Because it’s all trash and lies.

  2. Prox is right. You really are clueless.

  3. No, I am not, it is the truth. You my friend are the clueless one, truly. Go back to your iphone and your television set, please.

  4. You are so clueless

  5. The BANKSTERS continue to commit fraud upon hardworking people and fraud upon the courts. The biggest Ponzi scheme the world has ever seen , where the Banksters created credit out of thin air, not for their borrowers, but for the banksters themselves via the Federal Reserve’s magic check book, with no bank account behind it. The Bankster then loaned that imaginary money to people on the security of overvalued real property with the deliberate aim of reducing the artificially raised property prices and putting people out of work.People without income cannot pay their bills, so they were guaranteed they could steal all that real property from their rightful owners. Of course you would say to yourself, that makes no sense because the Banksters would lose money when foreclosing on the security , but you’d be wrong because the banksters insured the debt with an insurance company, but just forgot to tell the borrowers that. SO they knew they could not lose. Its what you might call having your cake and eating it too. You see, just secretly insuring the debt was the way they ensured that they lost no money. First they sold investors in Wall Street on the idea of using pensions and other fund moneys to invest in the profitable housing market. Then they sold homeowners on the idea of borrowing money against their rising property values, secure in knowing that they had artificially raised those prices and knew they could reverse that trend rapidly, when the time was right. Then they found another group of investors and sold them on insuring against the unlikely risk of those secure mortgages defaulting. But, as you know, they had already insured the downside risk. So they devised a new name that no one understood called the credit default swap. These were not insurance policies regulated by the states, but were unregulated securities sold on wall street to investors. So, once they got the business of insurance outside of the regulatory realm, it was no holds barred and they sold the same investment to up to 20 different groups in respect of every mortgage pool they pretended to create in the securitized mortgage scam.But people need to lose the mindset of someone who has been brainwashed by the garbage put out by government at state and federal level and echoed in the corporate owned media

    SO therefore, The banksters along side Freddie and Fannie, were and still are continuing to submit fraudulent documents to the courts in order to steal homes from homeowners. They and their substitute trustee lawyers (ie Samuel I White PC, just one of many ) are submitting FRAUDULENT papers to the courts in order to FRAUDULENTLY foreclose on homeowners across the nation. Mortgage notes with Forged Owners signatures and ta-da endorsements are being submitted to the courts in order to steal homes. Bank of america(or as they like to refer to themselves…fka countrywide) made a deal with the attorney generals to modify loans that they really had no right to modify as they were illegally acquired to begin with. They committed notary fraud, forgery, added fake endorsements and as their crimes began to come to light…………they made a deal and instead of modifications (which they LED the homeowners to believe what was happening)….they handed the fraudulent documents over to Green Tree, soon to be called DiTech..corporate criminals are notorious for changing their names after lights shine on their crimes…, among others, to foreclose. Meanwhile, homeowners are the ones who are paying the price by having their homes taken because of felonies that are being committed . Fraud upon the courts, racketeering, forgery, wire fraud, notary fraud…pathetic, nauseating, and just all around COMPLETELY disgusting. Wake up America. Wake Up.

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