The Largest Fraud in American Capital Markets History

FHFA places Fannie Mae and Freddie Mac into conservatorship. Treasury commits $200B in support via Senior Preferred Stock Purchase Agreements (PSPAs).

Fannie and Freddie draw on the Treasury commitment during the housing crisis. Media frames them as "bailout recipients" despite being profitable enterprises forced into conservatorship.

Treasury and FHFA secretly amend the PSPAs to sweep 100% of GSE profits to Treasury --- forever. This retroactively ensures shareholders can never be repaid, despite the GSEs becoming massively profitable.

Fannie and Freddie report record profits. They have now paid back far more than they drew from Treasury. Under the Net Worth Sweep, all profits go straight to the government.

Hedge fund Perry Capital files suit challenging the Net Worth Sweep as an illegal taking of shareholder property. The first major legal challenge.

Glen Bradford begins accumulating Fannie/Freddie junior preferred shares --- FNMAS, FMCKJ, and the full basket. Starts writing the first Fanniegate book.

Bruce Berkowitz's Fairholme Fund files suit. Multiple shareholder lawsuits now challenging the constitutionality of the Net Worth Sweep.

Glen publishes the first Fanniegate book: "The first sound they'll hear is their heads hitting the floor." Begins the 8-year documentation project.

D.C. Circuit rules HERA bars judicial review of FHFA's actions. A devastating setback, but the fight continues in other courts.

Fifth Circuit rules the FHFA's structure is unconstitutional --- the single-director removable only for cause violates separation of powers. Shareholders win a major constitutional argument.

Treasury amends the PSPAs to allow Fannie and Freddie to retain $25B and $20B respectively. First sign of movement toward recapitalization.

Supreme Court affirms FHFA structure was unconstitutional but limits the remedy. Sends the case back for further proceedings. Mixed result --- the constitutional question is settled but shareholders need more.

Judge Lamberth presides over trial in the D.C. shareholder cases. Key discovery documents reveal government officials knew the Net Worth Sweep was designed to prevent shareholders from ever being repaid.

Judge Lamberth rules for the government, finding no breach of contract or fiduciary duty. Shareholders appeal. The fight enters its second decade.

Glen publishes the final Fanniegate book: "Recap and Release." After a decade of writing, the 8-book series is complete.

Scott Bessent, who has publicly discussed GSE recapitalization, is confirmed as Treasury Secretary. Shareholders see the most favorable political environment in over a decade.

With a sympathetic Treasury Secretary, bipartisan interest in housing reform, and GSEs sitting on massive retained earnings, recapitalization and release is finally a real possibility. Total shareholder payments to Treasury now exceed $300B --- far more than the ~$190B drawn.