Casey urges Obama to stop Freddie Mac bets against homeowners

Sen. Bob Casey Jr. (D-Pa.) wrote to President Obama on Monday urging him to put a stop to bets mortgage giant Freddie Mac allegedly took against homeowners.

Freddie Mac has told Congress that it is dedicated to helping homeowners refinance their homes, but an investigation from Pro Publica and NPR out Monday alleges that the mortgage giant’s trading division stood to profit if homeowners were unable to refinance.
 
“If this is the case, Freddie Mac embraced a position in direct opposition to a policy recommendation that is widely viewed to be essential to our recovery and advocated by your Administration as recently as the State of the Union,” Casey states in his letter.

“While it is plausible that a firewall keeps the investment arm of the organization from speaking to the refinancing department, the head of the organization should be plainly aware of the activities of each department. I question the leadership that would position the government-backed organization to bet against homeowners,” his letter states.

Casey asks Obama to “put an end to these practices.”

Freddie Mac is regulated by the independent Federal Housing Finance Agency but Obama can influence its decisions. Edward DeMarco is currently the acting director of FHFA and he is carbon copied on the letter.

White House spokesman Jay Carney said Monday that the report about Freddie Mac raises "concerns" and the Treasury department is looking into the matter

"As you know, this is an independent institution with independent governance, so we don't make those kinds of decisions.  But I believe Treasury is looking into it," he said.