Mortgage industry confidence shaken as Fannie Mae’s ethics team reportedly ousted under FHFA director
Recent firings at Fannie Mae by Federal Housing Financing Agency (FHFA) director Bill Pulte have unsettled the mortgage industry and raised new concerns about oversight and stability during a critical moment for the United States housing market.
According to the Washington Post, Pulte dismissed dozens of Fannie Mae employees last month, including the entire ethics and compliance team. Multiple sources indicated to the Post that the firings came shortly after Fannie's ethics team, led by Suzanne Libby, began investigating multiple complaints against a high-ranking officer close to Pulte.
Pulte said he fired staff to end diversity, equity and inclusion (DEI) programs, but the decision also got rid of Fannie Mae’s internal watchdogs—those who oversee legal compliance and investigate misconduct.
On October 23, investigators were ordered to halt their probe, and Libby, along with other top officials including general counsel Danielle McCoy and head of single-family business Malloy Evans, were soon terminated. Neither Libby, McCoy nor Evans responded to requests for comment.
Industry reaction and regulatory uncertainty
The shake-up has rattled confidence among lenders, investors, and other stakeholders, especially as the Trump administration eyes a historic public offering to return Fannie Mae and Freddie Mac to private hands.
Pulling off the largest IPO in history requires broad industry support, but recent events could be eroding faith in the firms’ futures.
Pulte, who has rapidly consolidated power since his March appointment, has also made headlines for his aggressive social media presence and close ties to President Trump. He has publicly attacked Federal Reserve officials and championed unproven claims of mortgage fraud against political adversaries, actions that have further unsettled the industry.
FHFA response and ongoing scrutiny
An FHFA spokesperson, declining to be named, dismissed the controversy: “We do not comment on specific personnel matters, and certainly not fake news from disgruntled anonymous ‘sources,'" they told the Post. "Housing finance markets are robust and liquid, we are following the law, and as reflected in recent earnings reports and cash balances, the companies are stronger than ever before.”
However, ethics experts and industry insiders warn that the removal of independent oversight at Fannie Mae could have long-term consequences for market stability and public trust.
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