I 

112TH CONGRESS 

1ST SESSION H. R. 2093 

To establish the Fannie Mae and Freddie Mac Investigative Commission 

to investigate the policies and practices engaged in by officers and directors at Fannie Mae and Freddie Mac responsible for making the decisions 

that led to the enterprises’ financial instability and the subsequent Federal conservatorship of such enterprises. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 2, 2011 

Ms. KAPTUR introduced the following bill; which was referred to the 

Committee on Financial Services 

A BILL 

To establish the Fannie Mae and Freddie Mac Investigative 

Commission to investigate the policies and practices engaged in by officers and directors at Fannie Mae and 

Freddie Mac responsible for making the decisions that 

led to the enterprises’ financial instability and the subsequent Federal conservatorship of such enterprises. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Fannie Mae and 

5 Freddie Mac Investigative Commission Act’’. 


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1 SEC. 2. DEFINITIONS. 

2 In this Act: 

3 (1) The term ‘‘Commission’’ means the Fannie 

4 Mae and Freddie Mac Investigative Commission es5 tablished under section 3. 

6 (2) The term ‘‘Fannie Mae’’ means the Federal 

7 National Mortgage Corporation. 

8 (3) The term ‘‘Freddie Mac’’ means the Fed9 eral Home Loan Mortgage Corporation. 

10 SEC. 3. ESTABLISHMENT. 

11 There is established a commission to be known as the 

12 ‘‘Fannie Mae and Freddie Mac Investigative Commis13 sion’’. 

14 SEC. 4. DUTY OF THE COMMISSION. 

15 (a) IN GENERAL.—The Commission shall investigate, 

16 determine, and make recommendations to Congress with 

17 respect to the policies, practices, and board decisions of 

18 Fannie Mae and Freddie Mac subsequent to the actions 

19 of the Resolution Trust Corporation during the late 1980s 

20 and from the 1990s through the present that led to the 

21 enterprises’ financial instability and the subsequent Fed22 eral conservatorship of such enterprises. 

23 (b) SPECIFIC TOPICS.—In carrying out its duty 

24 under subsection (a), the Commission shall address and 

25 analyze, by year, beginning in 1990 and through the 

26 present, the following: 


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1 (1) The appropriate role of Fannie Mae and 

2 Freddie Mac in expanding homeownership and the 

3 appropriate role in helping the housing market re4 cover nationwide. 

5 (2) Fannie Mae and Freddie Mac’s involve6 ment, if any, in the development of faulty risk 

7 standards and accounting practices and the creation 

8 and proliferation of the securitized mortgage instru9 ment, and how such instrument affected the solvency 

10 of such enterprises. 

11 (3) The role of the boards of directors of 

12 Fannie Mae and Freddie Mac in developing and vot13 ing for the investment, accounting, and contracting 

14 policies of such enterprises, particularly as they re15 late to risk assessments, subprime mortgages, and 

16 the international securitization of mortgages. 

17 (4) Any board members, working committees, 

18 or executive officers responsible for making the deci19 sions to adapt or change risk assessments or grow 

20 Fannie Mae and Freddie Mac’s portfolios of 

21 subprime mortgage loans, a summary of actual 

22 board votes on the same, and the process that led 

23 to such decisions. 

24 (5) The decisions of the boards or executive of25 ficers of Fannie Mae and Freddie Mac that contribVerDate Mar 15 2010 23:01 Jun 07, 2011 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2093.IH H2093

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1 uted or may have contributed to the overvaluation of 

2 risky mortgage investments in the stock market and, 

3 later, to the growth of the subprime mortgage indus4 try. 

5 (6) The annual compensation, including all 

6 forms of compensation, stock options, and other fi7 nancial benefits accrued to each of Fannie Mae and 

8 Freddie Mac’s executive officers and members of the 

9 boards of directors. 

10 (7) Such other matters that the Congress may 

11 place before the Commission. 

12 SEC. 5. MEMBERSHIP. 

13 (a) NUMBER AND APPOINTMENT.— 

14 (1) IN GENERAL.—The Commission shall be 

15 composed of 8 members, appointed as follows: 

16 (A) Two members appointed by the Speak17 er of the House of Representatives. 

18 (B) Two members appointed by the minor19 ity leader of the House of Representatives. 

20 (C) Two members appointed by the major21 ity leader of the Senate. 

22 (D) Two members appointed by the minor23 ity leader of the Senate. 

24 (2) QUALIFICATIONS.—Members of the Com25 mission shall be individuals who are of recognized 


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1 standing and distinction in the areas of banking, se2 curities and finance regulation, consumer advocacy 

3 and fair housing programs, and the mortgage indus4 try. 

5 (3) CONFLICT OF INTEREST.—Members of the 

6 Commission shall not have a conflict of interest that 

7 is relevant to any matter the Commission is required 

8 to investigate under section 4. 

9 (4) DEADLINE FOR APPOINTMENT.—Members 

10 of the Commission shall be appointed not later than 

11 90 days after the date of enactment of this Act. 

12 (5) CHAIRPERSON.—The Chairperson of the 

13 Commission shall be designated by the Speaker of 

14 the House of Representatives at the time of appoint15 ment. 

16 (b) TERMS.— 

17 (1) IN GENERAL.—Each member shall be ap18 pointed for the life of the Commission. 

19 (2) VACANCIES.—A vacancy on the Commission 

20 shall— 

21 (A) not affect the power of the remaining 

22 members to execute the duty of the Commis23 sion; and 

24 (B) be filled in the manner in which the 

25 original appointment was made. 


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1 (c) COMPENSATION.— 

2 (1) RATES OF PAY; TRAVEL EXPENSES.—Each 

3 member shall serve without pay, except that each 

4 member shall receive travel expenses, including per 

5 diem in lieu of subsistence, in accordance with appli6 cable provisions under subchapter I of chapter 57 of 

7 title 5, United States Code. 

8 (2) PROHIBITION OF COMPENSATION OF FED9 ERAL EMPLOYEES.—Notwithstanding paragraph (1), 

10 any member of the Commission who is a full-time of11 ficer or employee of the United States may not re12 ceive additional pay, allowances, or benefits because 

13 of service on the Commission. 

14 (d) MEETING REQUIREMENTS.— 

15 (1) FREQUENCY.— 

16 (A) QUARTERLY MEETINGS.—The Com17 mission shall meet at least quarterly. 

18 (B) ADDITIONAL MEETINGS.—In addition 

19 to quarterly meetings, the Commission shall 

20 meet at the call of the Chairperson or a major21 ity of its members. 

22 (2) QUORUM.—Five members of the Commis23 sion shall constitute a quorum, but a lesser number 

24 may hold hearings. 


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1 (3) MEETING BY TELEPHONE OR OTHER AP2 PROPRIATE TECHNOLOGY.—Members of the Com3 mission are permitted to meet using telephones or 

4 other suitable telecommunications technologies pro5 vided that all members of the Commission can fully 

6 communicate with all other members simultaneously. 

7 SEC. 6. DIRECTOR AND STAFF OF COMMISSION; EXPERTS 

8 AND CONSULTANTS. 

9 (a) DIRECTOR.— 

10 (1) APPOINTMENT.—The Commission shall 

11 have a Director who shall be appointed by the Chair12 person with the approval of the Commission. 

13 (2) CREDENTIALS.—The Director shall have ex14 perience in the areas of banking, securities and fi15 nance regulation, consumer advocacy and fair hous16 ing programs, and the mortgage industry. 

17 (3) SALARY.—The Director shall be paid at a 

18 rate determined by the Chairperson with the ap19 proval of the Commission, except that such rate may 

20 not exceed the rate of basic pay for GS–15 of the 

21 General Schedule. 

22 (b) STAFF.—With the approval of the Chairperson, 

23 the Director may appoint and fix the pay of additional 

24 qualified personnel as the Director considers appropriate. 


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1 (c) EXPERTS AND CONSULTANTS.—With the ap2 proval of the Commission, the Director may procure tem3 porary and intermittent services under section 3109(b) of 

4 title 5, United States Code, but at rates for individuals 

5 not to exceed the daily equivalent of the maximum annual 

6 rate of basic pay for GS–15 of the General Schedule. 

7 (d) STAFF OF FEDERAL AGENCIES.—Upon request 

8 of the Commission, Chairperson, or Director, the head of 

9 any Federal department or agency may detail, on a nonre10 imbursable basis, any of the personnel of that department 

11 or agency to the Commission to assist the Commission in 

12 carrying out its duty under this Act. 

13 SEC. 7. POWERS OF COMMISSION. 

14 (a) HEARINGS AND SESSIONS.—The Commission 

15 may, for the purposes of carrying out this Act, hold hear16 ings, sit and act at such times and such places, take testi17 mony, and receive evidence as the Commission considers 

18 appropriate. 

19 (b) SUBPOENA POWER.— 

20 (1) IN GENERAL.—The Commission may issue 

21 a subpoena to require the attendance and testimony 

22 of witnesses and the production of evidence relating 

23 to any matter under investigation by the Commis24 sion. 


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1 (2) ISSUANCE AND SIGNATURE.—Subpoenas 

2 issued under paragraph (1) shall bear the signature 

3 of the Chairperson of the Commission and shall be 

4 served by any person or class of persons designated 

5 by the Chairperson for that purpose. 

6 (3) ENFORCEMENT.—If a person refuses to 

7 obey a subpoena issued under paragraph (1), the 

8 Commission may apply to a United States district 

9 court for an order requiring that person to appear 

10 before the Commission to give testimony, produce 

11 evidence, or both, relating to the matter under inves12 tigation. The application may be made within the ju13 dicial district where the hearing is conducted or 

14 where that person is found, resides, or transacts 

15 business. Any failure to obey the order of the court 

16 may be punished by the court as civil contempt. 

17 (c) POWERS OF MEMBERS AND AGENTS.—Any mem18 ber or agent of the Commission may, if authorized by the 

19 Commission, take any action which the Commission is au20 thorized to take under this Act. 

21 (d) OBTAINING OFFICIAL DATA.—The Commission 

22 may secure directly from any department or agency of the 

23 United States information necessary to enable it to carry 

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1 person, the head of that department or agency shall fur2 nish that information to the Commission. 

3 (e) PHYSICAL FACILITIES AND EQUIPMENT.—The 

4 Architect of the Capitol, in consultation with the appro5 priate entities in the legislative branch, shall locate and 

6 provide suitable facilities and equipment for the operation 

7 of the Commission on a nonreimbursable basis. 

8 (f) ADMINISTRATIVE SUPPORT SERVICES.—Upon re9 quest of the Commission, the Architect of the Capitol and 

10 the Administrator of the General Services shall provide to 

11 the Commission on a nonreimbursable basis such adminis12 trative support services as the Commission may request 

13 in order for the Commission to carry out its duty under 

14 this Act. 

15 (g) BYLAWS, RULES, AND REGULATIONS.—The 

16 Commission may adopt, amend, and repeal bylaws, rules, 

17 and regulations governing the conduct of its business and 

18 the performance of its duties. 

19 (h) COMMISSION RECORDS.—The Commission shall 

20 keep accurate and complete records of its doings and 

21 transactions which shall be made available for public in22 spection, and for the purpose of audit and examination 

23 by the Comptroller General or his designee. 


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1 SEC. 8. INFORMATION FROM FREDDIE MAC, FANNIE MAE, 

2 AND THE FHFA. 

3 (a) ENTERPRISES.—Fannie Mae and Freddie Mac 

4 shall provide full and prompt access to the Commission 

5 to any books, records, and other information requested for 

6 the purposes of carrying out its duty under this Act. 

7 (b) FHFA.—Upon request of the Commission, the 

8 Director of the Federal Housing Finance Agency shall 

9 provide access to any information necessary to assist the 

10 Commission in carrying out its duty under this Act. 

11 SEC. 9. REPORT. 

12 Not later than 12 months after the date on which 

13 all initial members are appointed, the Commission shall 

14 submit to Congress a final report containing a detailed 

15 statement of the findings, conclusions, and recommenda16 tions of the Commission. 

17 SEC. 10. AUTHORIZATION OF APPROPRIATIONS. 

18 There are authorized to be appropriated to the Com19 mission such sums as may be necessary for fiscal year 

20 2011 to carry out this Act. 

21 SEC. 11. TERMINATION. 

22 The Commission shall terminate following the sub23 mission and presentation of its final report and rec24 ommendations under section 9, but not later than 30 days 

25 after such submission and presentation. 

Æ 


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