Ugoletti Deposition Highlight

BY MR. THOMPSON: Q. Okay. Now, you did not raise the topic of the Net Worth Sweep with the companies until just a couple of days before August 17th; is that right?

UGOLETTI: I do not recall ra- — I did not raise the topic with them. I’m not sure when Acting Director — I can’t, on this time line, I can’t recall when Acting Director DeMarco actually — and I’m pretty sure he called both companies and talked them through it. They did get a copy of what became close — what became the final version to review. But that’s, that’s — in terms of the time line, that’s as far as I can remember.

BY MR. THOMPSON: Q. But they weren’t involved in the negotiations over the Net Worth Sweep, were they?

A. No. They weren’t involved in negotiations over the PSPAs or any of the amendments to the PSPAs, or this amendment to the PSPA.

Q. But this amendment to the PSPA was driven by a perceived problem, right?

BY MR. THOMPSON:  Q. A problem that their funding commitment might be exhausted, right?

A. Right, and you’ve showed me enough of their views on what they thought the base case looked like, so why — what — so I understand what their views were.

Q. Okay. But my question is: Why not talk to them and see if they have thoughts on whether there are different alternatives to solve this problem?

A. Just not an issue that we would talk to the companies about.

Q. You didn’t value their opinion?

UGOLETTI: We valued their opinion and, their opinion and understand what their opinion is, I understand it.

BY MR. THOMPSON: Q. Okay. What was their reaction when they told all of their income would be swept to the federal government?

UGOLETTI: I don’t, I don’t recall a specific reaction that I could sit here and say —

BY MR. THOMPSON: Q. Well, a —

A. — this, this CEO said that, that CEO said that, I don’t recall, I don’t recall a specific one.

Q. Do you have a recollection of the general reaction?

A. Well, I think their general reaction was they probably were not too happy about it.

Q. Why not?

A. Well, in many camps within Fannie Mae and Freddie Mac, I mean, I think there were people, they, they certainly never liked the Treasury Department saying that they were going to be wound down. They  didn’t want to be wound down, right. You don’t want to be wound down. You want to be Fannie Mae and Freddie Mac. So to the extent that they perceived this as further somehow taking that possibility away, they might not have been very happy about it.


When it comes to Mr. Ugoletti, everyone immediately focuses on the DTAs. That is obviously a big deal.  

However, the above passage is also pretty significant… 

Where in this exchange is there discussion about preserving and conserving the companies’ assets? Where is the intent “…of returning the entities to normal business operations?” (J. Lockhart’s words 9/7/08)

This deposition makes explicitly clear that the Conservator rather worked with Treasury over the boards and senior leaders at Fannie and Freddie.  Remember, the original executive teams were replaced with FHFA hand-picked leaders.  And still, FHFA did not care to consult with the companies’ leadership teams on this vitally important matter.

This part of the deposition is damning evidence that both FHFA and Treasury conspired to defy the laws outlined in HERA. Here is a senior official who worked at FHFA, and Treasury before that, stating their focus was to put Fannie and Freddie out of business.  

And Mr. Ugoletti makes it clear that Treasury was making the decisions regarding Fan and Fred… not the Conservator as required by law.

It is a clear admission of guilt… 

Click to access 13-465-0304-Unsealed-Exhibits-C-through-I.pdf


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