The inspector general of the Federal Housing Finance Agency (FHFA) is accusing the agency’s director, Bill Pulte, of unlawfully obstructing the internal watchdog group’s mandated oversight responsibilities.
A blistering report sent to congressional lawmakers Friday comes amid moves by Pulte to gut the agency’s Office of Inspector General (OIG). Reuters first reported the delivery of the OIG’s report to Congress.
The report reviewed by Scotsman Guide alleges “unprecedented” obstruction by the FHFA, saying it has been forced to delay evaluation reports regarding the agency’s oversight of Fannie Mae’s and Freddie Mac’s multifamily businesses, as well as a “special project on the effectiveness of Fannie Mae’s loan review and approval processes.”
“While we have recently been given access to information sufficient to allow the evaluations to move forward, the access restrictions caused significant delay,” the OIG report states. “Moreover, due to FHFA’s drastic cut to our [fiscal year] 2027 funding, we will be further impeded from completing for publication all three evaluation reports.”
OIG flags obstruction amid defunding fight
The FHFA is responsible for regulating government-sponsored mortgage investors Fannie Mae and Freddie Mac, as well as the Federal Home Loan Banks. In a highly unusual arrangement, Pulte serves as both director of the FHFA and board chair of Fannie and Freddie. He appointed himself to the roles and quickly overhauled the companies’ boards after being confirmed by the Senate to run the FHFA in early 2025.
In November of 2025, Pulte ousted the acting head of the FHFA’s OIG, Joe Allen, and a replacement has not been named. James Hodge, who holds the title of acting principal deputy inspector general, is currently performing the duties of the OIG’s top official.
As Scotsman Guide reported last month, the FHFA is slashing the OIG’s 2027 budget by approximately 64%, which the watchdog agency has said would necessitate substantial workforce reductions.
The move was blasted by top Democratic leaders in the House and Senate, who called it a “corrupt crusade” by Pulte “to protect himself and President Trump from accountability.” The lawmakers called for Pulte’s resignation.
In the newly issued OIG report, the watchdog group says it engaged in “extensive dialogue with the FHFA” to explain its budgetary needs, but the talks “did not alter the Agency’s decision to unilaterally reduce OIG’s budget.”
The OIG also alleged the FHFA refused to provide requested records on several occasions, including information related to oversight of a multifamily lender that had defaulted in 2024.
In an email to Scotsman Guide, an FHFA spokesperson said the agency has “delivered every document and engaged in every interview the IG has requested under its statutory authorities.” They noted that three “recent reviews” required the FHFA to complete 56 document requests and 16 separate hour-long meetings.
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The spokesperson also flagged budgetary concerns, saying the OIG’s original budget request was nearly nine times higher than the average budget for other internal watchdog agencies across the federal government.
“Independence does not mean exemption from fiscal accountability,” the FHFA representative wrote. “FHFA remains willing to work with OIG to offer what support it needs to effectively budget and exercise reasonable financial stewardship in carrying out its statutory responsibilities, as is customary in every federal agency.”
An OIG spokesperson declined to comment for this article.
Pulte subject of separate GAO investigation
The OIG’s claims are not the first allegations of the FHFA obstructing statutory oversight under Pulte’s leadership.
The Government Accountability Office, a congressional watchdog group, confirmed to Scotsman Guide last month that an ongoing GAO inquiry into Pulte over his handling of mortgage fraud referrals may be complete by late 2026 or early 2027.
That inquiry was based on a request by eight Democratic U.S. senators, led by Elizabeth Warren of Massachusetts, who aired concerns that Pulte selectively targeted influential Democrats and policymakers viewed as opponents of President Donald Trump.
The senators questioned why Pulte personally made the criminal referrals to the Department of Justice instead of going through his agency’s OIG, which has historically been tasked with DOJ referrals.
“Mr. Pulte’s actions demand scrutiny,” the senators wrote in their letter to the GAO. “It is unclear why Pulte made these claims, how he accessed the information as Director to make such claims, and whether and how official FHFA resources — staff time, government communications systems, or privileged data — were used to do so.”
Among the highest-profile mortgage fraud allegations involves Federal Reserve Governor Lisa Cook, who has denied wrongdoing and attributes any discrepancies on mortgage applications to clerical errors.
A series of court rulings — including a 5-4 decision by the Supreme Court in June — have allowed Cook to remain in office.
An unprecedented White House hearing initially scheduled for Nov. 5 to debate the merits of the fraud claims against Cook has been pushed to December, White House adviser Kevin Hassett told Bloomberg TV last week.
