February 5, 2015 By Richard Bowen

Why Is Our Government in the Mortgage Business?

We sure don’t want to be, but it looks like we are heading in that direction.

“In the name of affordable loans, the White House is creating the conditions for a replay of the housing disaster,” states the caption in a recent WSJ article on the “coming mortgage meltdown.”

[tweetthis twitter_handles=”@richardmbowen”]Why are we – oh, excuse me, why is our government in the mortgage business?[/tweetthis]

Looks like the Obama administration is lowering standards and annual mortgage insurance premiums “to make mortgages more affordable and accessible.”

Prior to the 2008 debacle, private lenders campaigned for a loosening of credit standards from federal mortgage agencies and their regulators. They got what they asked for and it resulted in a price tag we are all still paying.

So Fannie and Freddie are now back on a deadly treadmill to meet government demands and each is offering to purchase from the private lenders 3% down payment mortgages at the behest of the Federal Housing Finance Agency.

Greed?

Lower pricing, increasingly loose credit and federal agencies fighting over high risk lending?

Studies from 2009 to today, by the government agencies themselves (FHFA) clearly point out that low down payment, 30 year loans to individuals with low FICO scores were consistently subsidized by less risky loans.

So given the recent history, why is Fannie offering to purchase heavily subsidized 3% down mortgages? Why are we heading down that path again? And why are government agencies allowing themselves to be involved in the affordable housing Ponzi game?

Ok, I keep saying greed. Is it? Or is this a deeper symptom of broken rules and regulations that allow government agencies to be subverted by business interests?

Sure looks like it!

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Richard Bowen is widely known as the Citigroup whistleblower. As Business Chief Underwriter for Citigroup during the housing bubble financial crisis meltdown, he repeatedly warned Citi executive management and the board about fraudulent behavior within the organization. The company certified poor mortgages as quality mortgages and sold them to Fannie Mae, Freddie Mac and other investors.

William D. Cohan

"Richard Bowen is one of my heroes. His is a story of human fortitude at its best and Wall Street at its worst."

~ William D. Cohan, NY Times Best Selling Author

2017-06-30T10:08:59-05:00

"Richard Bowen is one of my heroes. His is a story of human fortitude at its best and Wall Street at its worst." ~ William D. Cohan, NY Times Best Selling Author

https://richardmbowen.com/testimonials/2556/

Eileen McDonnell

"Richard Bowen reinforced my motto that "there is no right way to do a wrong thing.” Long after his presentation, the conversation has continued about personal responsibility and the courage to challenge things that appear to be wrong. We encourage this dialog and rely on it to help make our business stronger."

~ Eileen McDonnell, Chairman, CEO, & President, Penn Mutual

2015-02-13T19:51:19-06:00

"Richard Bowen reinforced my motto that "there is no right way to do a wrong thing.” Long after his presentation, the conversation has continued about personal responsibility and the courage to challenge things that appear to be wrong. We encourage this dialog and rely on it to help make our business stronger." ~ Eileen McDonnell, Chairman, CEO, & President, Penn Mutual

https://richardmbowen.com/testimonials/711/

"Richard Bowen, you are a star and a hero."

~ Ben Stein, Economist and Political Commentator

2015-02-13T19:50:26-06:00

"Richard Bowen, you are a star and a hero." ~ Ben Stein, Economist and Political Commentator

https://richardmbowen.com/testimonials/712/

"Richard's speech at the April Financial Executives International dinner was informative, interesting, riveting, and fast moving. The feedback from members was overwhelming positive, and Richard received one of the few standing ovations given by our membership."

~ Jim Farrell, Program Chairman, Dallas Chapter, Financial Executives International

2014-12-28T19:48:17-06:00

"Richard's speech at the April Financial Executives International dinner was informative, interesting, riveting, and fast moving. The feedback from members was overwhelming positive, and Richard received one of the few standing ovations given by our membership." ~ Jim Farrell, Program Chairman, Dallas Chapter, Financial Executives International

https://richardmbowen.com/testimonials/532/

Dennis McCuistion

"Richard Bowen has been there, done that, and has the scars to prove it, and his message of corruption at the highest levels of industry and government needs to be heard. I only wish that more bankers had the courage that Bowen exhibits. He is not only one of the most talented bankers I have ever met, he has more integrity than all the bankers on Wall Street put together. If his former employer had listened to him taxpayers would not have had to bail out Citi for the third time in the last 30 years."

~ Dennis McCuistion, Host of the McCuistion TV program

2014-12-28T19:48:06-06:00

"Richard Bowen has been there, done that, and has the scars to prove it, and his message of corruption at the highest levels of industry and government needs to be heard. I only wish that more bankers had the courage that Bowen exhibits. He is not only one of the most talented bankers I have ever met, he has more integrity than all the bankers on Wall Street put together. If his former employer had listened to him taxpayers would not have had to bail out Citi for the third time in the last 30 years." ~ Dennis McCuistion, Host of the McCuistion TV program

https://richardmbowen.com/testimonials/533/

"Richard Bowen is a dynamic, entertaining speaker and story-teller - a CPA with a great personality!"

~ Betty Garrett, Garrett Speakers International

2014-12-28T19:47:50-06:00

"Richard Bowen is a dynamic, entertaining speaker and story-teller - a CPA with a great personality!" ~ Betty Garrett, Garrett Speakers International

https://richardmbowen.com/testimonials/531/

"I believe Richard Bowen is the only keynote speaker to ever receive a standing ovation from the Texas Society of CPA’s at any of its annual conferences."

~ Fred Timmons, Chairman of The Texas Society of CPA's

2014-12-28T19:47:22-06:00

"I believe Richard Bowen is the only keynote speaker to ever receive a standing ovation from the Texas Society of CPA’s at any of its annual conferences." ~ Fred Timmons, Chairman of The Texas Society of CPA's

https://richardmbowen.com/testimonials/530/

"The most emotional and impactful session was absolutely Richard Bowen and the Citi Mortgage case. I was somewhat aware of the challenges and hardships faced by whistleblowers. The HBR case and documentary on Sherry Hunt's experience provided a strong understanding of the case and overall situation. However, the nuance and emotion that Bowen brought in his lecture will be one of my lasting memories of the program. His unique perspective of the exhausting experience of constantly trying to do the right thing only to be stonewalled by his leadership, and later, the US government, highlights the challenges of doing the right thing, yet the importance of someone speaking up. Bowen made whistleblowing personal to us, and I will never forget his quote that if you see wrongdoing, you have two choices, "say something or get out." Taking a stand will have an enduring impact on your career and life regardless of the outcome. It certainly causes me to prioritize selecting the right corporate culture in my future organizations."

~ EMBA student review after Richard spoke to the class

2024-09-25T16:10:48-05:00

"The most emotional and impactful session was absolutely Richard Bowen and the Citi Mortgage case. I was somewhat aware of the challenges and hardships faced by whistleblowers. The HBR case and documentary on Sherry Hunt's experience provided a strong understanding of the case and overall situation. However, the nuance and emotion that Bowen brought in his lecture will be one of my lasting memories of the program. His unique perspective of the exhausting experience of constantly trying to do the right thing only to be stonewalled by his leadership, and later, the US government, highlights the challenges of doing the right thing, yet the importance of someone speaking up. Bowen made whistleblowing personal to us, and I will never forget his quote that if you see wrongdoing, you have two choices, "say something or get out." Taking a stand will have an enduring impact on your career and life regardless of the outcome. It certainly causes me to prioritize selecting the right corporate culture in my future organizations." ~ EMBA student review after Richard spoke to the class

https://richardmbowen.com/testimonials/4629/