Fannie Mae spent $10.1 million on lobbying last year, as Congress considered legislation to tighten oversight of the mortgage giant in response to its multibillion-dollar accounting scandals.
According to records filed last week with Congress, Fannie Mae and Freddie Mac remained among the most prolific corporate spenders on lobbying, despite controversy over their efforts to influence lawmakers. Freddie Mac spent $12.6 million on lobbying, according to the Web site PoliticalMoneyLine.
The two companies are heavily regulated by Congress and chartered with a public mission of encouraging home ownership. Critics have argued that their lobbying has been too geared toward trying to avoid tighter regulation and toward benefiting stockholders.
Both Fannie Mae and its fellow government-sponsored enterprise, Freddie Mac, have been rocked by accounting scandals. In December 2004, Fannie Mae replaced Franklin Raines, its chairman and CEO, who announced he was taking early retirement, and Fannie Mae’s chief financial officer, Timothy Howard, resigned Dec. 21.
Problems identified so far are expected to result in a profit restatement of as much as $11 billion.
Freddie Mac spent $12.6 million on lobbying, down from $15.4 million in 2004 but still enough to place it 11th among corporations that so far have filed lobbying disclosure forms for 2005, according to PoliticalMoneyLine.
Fannie Mae was 15th. The rankings are likely to change because many of the 2005 filings are still being processed, but in previous years Fannie Mae and Freddie Mac routinely ranked in the top 25.
According to an amended Lobbying Disclosure Act report filed by Fannie Mae last week, the mortgage giant spent $10.1 million, up from $8.78 million in 2004.
The government-sponsored enterprise had pledged to cut back its extensive lobbying network.
According to details provided by the company, Fannie Mae did reduce its spending last year on outside lobbyists by 24 percent, to $3.7 million, canceling contracts with several firms and discontinuing public affairs advertising.
But Fannie Mae’s in-house lobbying costs rose 64 percent, to $7 million, despite laying off six outside lobbying consultants.
In a statement by Brian Faith, Fannie’s director of communication, Faith attributed the growth in lobbying costs to the rapid increase last year in the company’s administrative expenses, “the basis for calculating internal lobbying costs.”
***
Send tips or a Letter to the Editor to janis@inman.com or call (510) 658-9252, ext. 140.
