Since the government seized control of Fannie Mae and Freddie Mac in the fall of 2008, the two have spent more than $160 million defending the firms and their former top executives in civil lawsuits.
According to a report in The New York Times, the cost was a closely guarded secret until last week, when the companies and their regulator produced an accounting at the request of Congress.
The bulk of those expenditures — $132 million — went to defend Fannie Mae and its officials in various securities suits and government investigations into accounting irregularities that occurred over the past decade.
Since the GSEs have been propped up using taxpayer money, that means the government has indirectly been paying their legal bills.
Most large corporations will pay the legal expenses of former executives if the lawsuits are tied to duties performed while at the company. In some cases, companies take out insurance policies to pay for legal costs.
