Meanwhile, in the Senate support is gradually increasing for an amendment introduced Monday that would prevent the $12.9 million in bonuses to be awarded to top executives at Fannie Mae and Freddie Mac.
“Awarding millions of dollars to officials who share responsibility for billions in financial losses is an offensive misuse of hard-earned tax dollars,” said Sen. Mike Johanns (R-Neb.) on Tuesday.
Along with Johanns, the amendment was introduced by Sens. John McCain (R-Ariz.), Jay Rockefeller (D-W.Va.), John Barrasso (R-Wyo.), Mike Enzi (R-Wyo.) and Lisa Murkowski (R-Alaska).
A recent bipartisan letter sent Nov. 4 and signed by 60 senators asks the FHFA to revise the compensation packages approved for 10 executives at the two companies.
The letter calls the bonuses “wildly imprudent” and urges the housing finance agency to make “changes to the executive compensation policy to more accurately reflect the mission of the agency and the fiscal reality facing the GSEs and the federal government.”
The letter, spearheaded by Sens. Mark Begich (D-Alaska) and John Thune (R-S.D.), also went out to Treasury Secretary Timothy Geithner because of the role the department plays in overseeing taxpayer dollars used to keep the government-sponsored mortgage giants solvent.
Earlier on Tuesday the panel’s ranking member, Rep. Elijah Cummings (D-Md.), sent a letter to Issa asking him to invite DeMarco to appear at the hearing.
Issa has invited Charles Haldeman Jr. and Michael Williams, the chief executives of Freddie Mac and Fannie Mae, respectively, to the hearing.
“In order to properly examine these compensation packages,” Cummings wrote, “the committee should hear from the official who approved them, Mr. DeMarco.”
Senate Banking, Housing and Urban Affairs Committee Chairman Tim Johnson (D-S.D.) said last week that he will hold a hearing on the bonuses and wants DeMarco to testify.
The FHFA reportedly approved $12.79 million in bonus pay for 10 Fannie Mae and Freddie Mac executives last year.
A report from the FHFA’s inspector general found that the housing agency “lacks the controls to monitor and evaluate Fannie and Freddie’s executive compensation decisions and fails to make them transparent to the public.”
DeMarco has been on the hot seat for most of this year as lawmakers, especially House Democrats, apply pressure on the agency to overhaul programs to improve the sluggish housing sector.
In addition, Cummings also requested that Issa ask the FHFA to produce all copies of all compensation packages for the top executives at Fannie Mae and Freddie Mac by Nov. 14.
“Without testimony from the head of the agency responsible for approving executive compensation at Fannie Mae and Freddie Mac, and without copies of the compensation packages we are supposed to review at the hearing, the committee’s oversight efforts will be inadequate and incomplete,” Cummings wrote.