OFHEO May Get More $$ for GSE Probes

The Office of Federal Housing Enterprise Oversight is in line to get additional funding for special investigations of Fannie Mae and Freddie Mac in fiscal year 2005.Congress just approved $4.5 million to help cover the costs of OFHEO's special investigation into the causes of Freddie Mac's $5 billion earnings restatement and to start a special examination of Fannie Mae's accounting practices. However, the president's fiscal 2005 budget proposal includes another $4.5 million for the "one-time costs to conduct special investigations" of the government-sponsored enterprises, plus $3 million to strengthen OFHEO's examination and legal functions. The fiscal 2005 budget proposal also provides for the transfer of OFHEO's resources to a new GSE regulator -- if Congress approves the Bush administration's proposals to strengthen regulation of Fannie, Freddie, and the Federal Home Loan Banks. Upon enactment of the administration's GSE reforms, Fannie and Freddie would also have to pay an initial $6 million assessment to cover the Department of Housing and Urban Development's costs of setting and enforcing the GSEs' affordable housing goals.