Freddie Mac Internal E-Mail: Warnings Ignored

I have read in several articles that starting in 1999 during the Clinton Administration "revolutionary" changes were made to the CRA-Community Reinvestment Act. The changes placed supervisory oversight of Banks in the hands of activist Community organizations-Non-profits. If the Banks wished to lend outside of their geographic area they needed to get positive recommendations from these Non-Profits.The non-Profits were interested in having the Banks expand their lending to minorities. A noble thought but not if the folks getting a mortgage cannot afford to pay. One of these non-profits was known as ACORN. Fannie and Feddie were then "encouraged" by politicians like Barney Frank and Chris Dodd and others to buy these marginal mortgages as good public policy. Fannie and Freddie balked as they knew the loans were not solid. Claude Raines and Johnson had cooked their books to enhance their bonuses and were caught. The politicians made a deal to go easy on them if they would buy the bad loans. The Politicians named above and several others thought this was good public policy for minorities to have their own homes-it is good policy when they can afford to pay the mortgages. It has ruined many neighborhoods where foreclosures were called for due to non-payment.

Any possibility that we can get an investigation going to investigate what the above seems to indicate?

Steven P. Cariati of NY 10:01PM December 12, 2008