An expose of bad businesses and their unethical practices

The Office of Federal Housing Enterprise Oversight (OFHEO) has tightened the rules which Fannie Mae and Freddie Mac must follow to report and minimize mortgage fraud. This comes at the end of a year in which the two agencies lost several billion dollars in mortgage defaults. OFHEO director James Lockhart said, “This guidance reflects the ongoing work of both OFHEO and the enterprises in the development and improvement of mortgage fraud detection and reporting.”

The rules now require both agencies to immediately report “insider fraud”, which is defined as a finding that “a board member, officer, employee, or contractor engaged by the enterprise has or may have engaged in mortgage fraud or possible mortgage fraud.” These are added  to existing rules which require them to report to OFHEO when they identify mortgage fraud and  when they believe when fraud may have a significant impact on their business. The updated rules also require the two companies to report any pattern of conduct or behavior that is "interpreted as mortgage fraud or possible mortgage fraud".