They were warned, but apparently failed to act.
Documents released today by a House oversight committee indicate that top executives of Fannie Mae and Freddie Mac ignored warnings that they were taking on too many risky loans years before the housing market crash.
And, says California Congressman Henry Waxman, their failure to act is costing taxpayers billions of dollars. Waxman chairs the House Oversight and Government Reform Committee.
Panel members today grilled the former heads of the two lending agencies for more than four hours, and appeared to be frustrated by their apparent refusal to accept any blame.
Today's hearings came as the National Association of Realtors reported that home sales in October fell by less than one percent compared to the previous month. But the figures included deeply discounted foreclosures and distressed sales that figured in roughly 40 percent of all transactions.
(Copyright 2008 by The Associated Press. All Rights Reserved.)