Fannie Mae is being sued for defamation by 41 former employees who were fired in April. Also named as defendants in two concurrent cases filed in Fairfax County (Virginia) Circuit Court are Bill Pulte, who serves as chairman of Fannie Mae, and Priscilla Almodovar, the company’s president and CEO.
The plaintiffs — who were fired for alleged unethical conduct, including the facilitation of fraud related to Fannie Mae’s charitable giving program — are seeking combined compensatory damages of $82 million between the two cases, as well as $350,000 per suit in punitive damages.
The complaints stem from a joint statement issued in April by Fannie Mae and the Federal Housing Finance Agency (FHFA), which Pulte heads, regarding the alleged employee misconduct.
“Since my swearing-in, we fired over 100 employees from Fannie Mae who we caught engaging in unethical conduct, including facilitating fraud, against our great company,” Pulte said in the statement. “Anyone who commits fraud against Fannie Mae does so against the American people.”
Almodovar was quoted as saying: “I would like to thank Director Pulte for his empowering of Fannie Mae to root out unethical conduct, including anyone facilitating fraud. We hold our employees to the highest standards, and we will continue to do so.”
The complaints claim those statements are defamatory, and insist the fired employees never engaged in unethical conduct or any form of fraud.
The court documents state the plaintiffs were summoned to a Microsoft Teams call on April 3 and told their employment was being terminated “‘for cause’ for violating Fannie Mae’s Charitable Giving program for fraud.”
“Despite multiple requests for evidence, both directly from Plaintiffs and through counsel, Plaintiffs were not given, and still do not have, any evidence to support the claims of fraud against Plaintiffs, jointly, or severally,” the complaints read.
Neither Fannie Mae nor the FHFA responded to Scotsman Guide’s requests for comment.
The complaint against Pulte also alleges that he defamed the plaintiffs when he appeared on the Fox News program “The Ingraham Angle” on April 9.
“We also found that they were making donations to the charity and then they were getting kickbacks — the internal company charity,” Pulte said during the Fox News interview.
The complaint claims those statements are “demonstrably false.”
A separate but related case is still pending
In July, a total of 66 plaintiffs — all of whom are also plaintiffs in the defamation cases — sued Fannie Mae in U.S. District Court for the District of Columbia, alleging they were discriminated against based on their national origin and age when their employment was terminated by Fannie Mae in April for the alleged misconduct and fraud.
That lawsuit elaborated on the backgrounds of the employees fired during the Microsoft Teams call, noting that each person is a U.S. citizen of Indian national origin, and most are over the age of 50 and speak the Telugu language.
The court filing also stated that all charities involved in the employees’ charitable contributions supported Indian national, ethnic and cultural programs.
Milton Johns, an attorney with Executive Law Partners PLLC, is representing the plaintiffs in both the Fairfax County and D.C. cases. He wrote in an email to Scotsman Guide on Thursday that the district case is currently “awaiting a reply from Fannie Mae.”
The plaintiffs in that lawsuit are demanding a jury trial and are seeking reinstatement of employment; payment of lost wages; payout of accrued vacation time; compensation for “emotional suffering and humiliation”; and payment of additional punitive damages or liquidated damages.
