After reviewing reports that detail the "general" and "administrative" expenses of Fannie Mae and Freddie Mac, I am concerned that Fannie and Freddie are spending money in ways and at levels that do not further the purposes of their conservatorships. On November 2nd, I wrote a letter to Edward DeMarco, acting director of the Federal Housing Finance Agency (FHFA), to inquire about pay-related and other expenditures made by Fannie Mae after it entered conservatorship in 2008.

Some questions contained in this letter are:

• Why did Fannie spend over $106,000,000 more in salaries and employee benefits in 2011 than in 2009?
• Why does Fannie Mae, and FHFA for that matter, feel it is necessary to spend nearly $6.5 million on recruiting new employees?
• Why is Fannie spending about $6 million in advertising in 2011?
• Fannie plans to spend $27.7 million in “Travel and Entertainment” expenses in 2011, including $1,630,975 in “Catered and Social Activity(ies),” even though Fannie is dependent on taxpayer support to remain solvent.
• Fannie plans to spend $66.8 million in “Miscellaneous Expenses” in 2011. What kinds of expenses are included within the “miscellaneous” category? And why did Fannie choose to classify over $66 million in a generic "miscellaneous" account?

Please find the text of the letter below: