Share this article!

A Phil Hall Op-Ed: The official duties of the director of the Federal Housing Finance Agency (FHFA) involves the regulation of Fannie Mae, Freddie Mac and the 11 Federal Home Loan Banks. It is not a law enforcement job, nor does this position involve choosing who should serve on the Board of Governors of the Federal Reserve. And, for that matter, the FHFA director is not tasked with doing publicity for the President of the United States.

Since taking on the role of FHFA director, Bill Pulte appears to be confused when it comes to fulfilling the clearly defined requirements of his position. In short, he’s doing everything but what he is supposed to be doing.

Yesterday, Pulte’s lack of focus on his official duties hit a new low when he posted claims on his personal X account that Lisa D. Cook, a governor of the Federal Reserve who was appointed by President Biden to serve through 2038, allegedly claimed two different homes as her primary residence on a pair of mortgage applications from 2021. Pulte announced that he made a criminal referral about Cook to the Department of Justice and then launched into a campaign on social media and conservative news channels ordering Cook to immediately resign while insulting everyone who questioned his demands. Pulte also insisted that Fed Chairman Jerome Powell fire Cook or else he would be complicit in her alleged chicanery.

Of course, Cook does not have to resign. She has not been indicted, let alone convicted of mortgage fraud. Nor does Powell have the authority to fire Cook – anyone with an elementary understanding of how the Federal Reserve works would be aware of that. Furthermore, no one in the Executive Branch has the right to demand that Fed officials resign – certainly not the head of the FHFA. To borrow a line from a popular insurance commercial, that’s not how any of this works.

Pulte ignored the fact that the Fed has its own Office of the Inspector General, which is tasked with investigating matters within the central bank. Any complaint regarding a Fed official should be directed to that office. Of course, there is no news value in referring a case to an Inspector General, hence Pulte using Pam Bondi as a publicity prop.

Pulte has previously made criminal referrals to the Department of Justice regarding alleged mortgage fraud committed years ago by New York Attorney General Letitia James and Sen. Adam Schiff, two Democratic lawmakers who are longtime bitter enemies of Trump. Curiously, Pulte did not make a criminal referral on mortgage fraud by Texas Attorney General Ken Paxton that was uncovered last month – not by the FHFA, but by the Associated Press. Paxton is a Republican and a Trump ally who reportedly claimed primary residence on three different mortgages. Where is the Pulte criminal referral for him?

This is not to say that mortgage fraud isn’t serious. But what isn’t serious is Pulte’s behavior and demeanor. Digging up four-year-old dirt on a Fed governor and then agitating endlessly for her to quit is the ultimate in stupidity. I’ve been writing about housing policy since 1988 and I’ve never seen any federal regulator demean their office in such a ridiculous manner as Pulte with his obnoxious grandstanding and caterwauling.

But then again, Pulte has turned the office of FHFA director into a joke. Before he set his eyes on Cook, he was endlessly insisting that Powell was a “moron” who should be fired. He also unilaterally dropped a surprise approval of VantageScore’s credit scoring system for mortgages sold to Fannie Mae and Freddie Mac as an alternative to FICO, ignoring the protocol of seeking public input for policy changes while reportedly failing to alert the Trump administration in advance of this significant change to housing policy. Even worse, it is a bad idea – the Wall Street Journal, which is no one’s idea of a left-wing rag, said it best when it berated Pulte’s rash decision with its editorial “How to Increase Mortgage Defaults.”

Earlier this week, Pulte shared a video advertisement on his personal X account hinting at a Fannie-Freddie merger into something called “The Great American Mortgage Corporation” that included glowing accolades of Trump’s leadership skills. As for Fannie and Freddie, Pulte also took the unprecedented step of installing himself as chairman of both enterprises – and that should certainly result in a healthy payout for Pulte if those entities conduct an initial public offering, as some media reports claim is coming.

It is unclear what role (if any) Pulte is playing in ending the federal conservatorship of the government-sponsored enterprises. Some press reports claim he is being kept out of the loop, with Treasury officials taking charge of the planning for this important initiative. Considering some of his nincompoop antics, hopefully those reports are correct and he will be the last to know what is happening.

Meanwhile, mortgage rates are still stuck near the 7% mark, mortgage delinquencies are up, home prices are still elevated, foreclosure levels are rising, and affordable homeownership opportunities remain elusive. Those are the issues the FHFA director should be focusing on but isn’t addressing.

In a post on his personal X account – for some strange reason, he never uses his government-issued X account – Pulte addressed his latest obsessional target with the wisecrack: “Miss Cook, You’ve destroyed yourself, I’m just doing my job.”

To which anyone who respects the rule of law and the concept of professional behavior should respond: “Mr. Pulte, You’ve embarrassed yourself and, by extension, those who believed you would bring intelligence and innovation to the FHFA. You’re not doing your job.”

Phil Hall is editor of Weekly Real Estate News. He can be reached at phil@ wrenews.com.