NELSON QUESTIONS FANNIE MAE, FREDDIE MAC EXECUTIVE COMPENSATION DEALS

September 10, 2008 – Nebraska's Senator Ben Nelson sent a letter today to Federal Housing Finance Agency Director James B. Lockhart III, urging him to examine and reduce the multi-million dollar severance packages approved for former executives of Fannie Mae and Freddie Mac.

According to news reports, the two CEOs of the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation who oversaw the firms in the time that led to a taxpayer-funded rescue and federal takeover could receive $24 million in pay, bonuses and benefits.

"I would like to stop the compensation packages for the two CEOs," said Senator Nelson. "We just can’t reward poor management this way. Unfortunately, corporate America has gone down that path way too often, rewarding incompetence and poor management with large payouts and buyouts. It’s so commonplace nobody thinks much about it in the corporate world. But the rest of us think a great deal about it, and we don’t like it."

"That's $24 million that shouldn't be shouldered by the taxpayers of this country. When you do a bad job you shouldn’t get a bonus as you walk out the door, or are booted out the door," Senator Nelson said.

In his letter, Nelson called on Lockhart to review the severance compensation packages and work to reduce or cancel the payments to the former chief executive officers of Fannie Mae and Freddie Mac. The government takeover last weekend has led to an injection of a vast amount of taxpayer-backed capital to try to stabilize the financially troubled organizations. Nelson urged Lockhart, in his role as conservator, to look for opportunities ahead to save money and conserve capital at the two organizations.

A copy of Senator Nelson's letter follows:

September 10, 2008

Mr. James B. Lockhart, III, Director
Federal Housing Finance Agency
1700 G Street, N.W.
Washington, DC 20552-0001

Dear Director Lockhart:

I write to you in your capacity as Conservator for the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) to urge you to carefully review the severance compensation packages of the former Chief Executive Officers (CEOs) of those two organizations.

Like many Americans, I am troubled by the news that the very executives who presided over Fannie Mae and Freddie Mac during the events which led to a taxpayer-funded rescue and takeover of the companies may walk away with as much as $24 million in pay, bonuses, and benefits. At a time when many American taxpayers are already hurting, we have placed vast sums of tax dollars at risk by injecting capital into Fannie Mae and Freddie Mac; surely we must now look for every opportunity to save money and conserve capital for these now taxpayer-run organizations. I offer that we should start that search by examining and curtailing severance packages for the executives who presided over Fannie Mae and Freddie Mac in the run-up to this takeover.

As Fannie Mae and Freddie Mac are under the control of the Federal Housing Finance Agency, your actions must reflect both the needs of the marketplace and the best interests of the taxpayer. I urge you to use your position to closely examine and reduce or eliminate compensation packages for the former Fannie Mae and Freddie Mac CEOs. To that end, I look forward to working with you on efforts to further stabilize the markets, and on determining the appropriate roles for Fannie Mae and Freddie Mac once this current crisis is over.

Thank you for your consideration of my concerns. I look forward to hearing from you.

Sincerely,

E. Benjamin Nelson
United States Senator

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	Press Release	September 10, 2008
NELSON QUESTIONS FANNIE MAE, FREDDIE MAC EXECUTIVE COMPENSATION DEALS September 10, 2008 – Nebraska's Senator Ben Nelson sent a letter today to Federal Housing Finance Agency Director James B. Lockhart III, urging him to examine and reduce the multi-million dollar severance packages approved for former executives of Fannie Mae and Freddie Mac. According to news reports, the two CEOs of the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation who oversaw the firms in the time that led to a taxpayer-funded rescue and federal takeover could receive $24 million in pay, bonuses and benefits. "I would like to stop the compensation packages for the two CEOs," said Senator Nelson. "We just can’t reward poor management this way. Unfortunately, corporate America has gone down that path way too often, rewarding incompetence and poor management with large payouts and buyouts. It’s so commonplace nobody thinks much about it in the corporate world. But the rest of us think a great deal about it, and we don’t like it." "That's $24 million that shouldn't be shouldered by the taxpayers of this country. When you do a bad job you shouldn’t get a bonus as you walk out the door, or are booted out the door," Senator Nelson said. In his letter, Nelson called on Lockhart to review the severance compensation packages and work to reduce or cancel the payments to the former chief executive officers of Fannie Mae and Freddie Mac. The government takeover last weekend has led to an injection of a vast amount of taxpayer-backed capital to try to stabilize the financially troubled organizations. Nelson urged Lockhart, in his role as conservator, to look for opportunities ahead to save money and conserve capital at the two organizations. A copy of Senator Nelson's letter follows: September 10, 2008 Mr. James B. Lockhart, III, Director Federal Housing Finance Agency 1700 G Street, N.W. Washington, DC 20552-0001 Dear Director Lockhart: I write to you in your capacity as Conservator for the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) to urge you to carefully review the severance compensation packages of the former Chief Executive Officers (CEOs) of those two organizations. Like many Americans, I am troubled by the news that the very executives who presided over Fannie Mae and Freddie Mac during the events which led to a taxpayer-funded rescue and takeover of the companies may walk away with as much as $24 million in pay, bonuses, and benefits. At a time when many American taxpayers are already hurting, we have placed vast sums of tax dollars at risk by injecting capital into Fannie Mae and Freddie Mac; surely we must now look for every opportunity to save money and conserve capital for these now taxpayer-run organizations. I offer that we should start that search by examining and curtailing severance packages for the executives who presided over Fannie Mae and Freddie Mac in the run-up to this takeover. As Fannie Mae and Freddie Mac are under the control of the Federal Housing Finance Agency, your actions must reflect both the needs of the marketplace and the best interests of the taxpayer. I urge you to use your position to closely examine and reduce or eliminate compensation packages for the former Fannie Mae and Freddie Mac CEOs. To that end, I look forward to working with you on efforts to further stabilize the markets, and on determining the appropriate roles for Fannie Mae and Freddie Mac once this current crisis is over. Thank you for your consideration of my concerns. I look forward to hearing from you. Sincerely, E. Benjamin Nelson United States Senator ###