[2026-10-01] Van Hollen Joins Banking Committee Democrats in Call on…

U.S. Senator Chris Van Hollen (D-Md.) joined Senator Elizabeth Warren (D-Mass.), Ranking Member of the Senate Banking, Housing and Urban Affairs Committee, alongside Senators Jack Reed (D-R.I.), Mark Warner (D-Va.), Catherine Cortez-Masto (D-Nev.), Tina Smith (D-Minn.), Raphael Warnock (D-Ga.), Andy Kim (D-N.J.), Ruben Gallego (D-Ariz.), Lisa Blunt Rochester (D-Del.), and Angela Alsobrooks (D-Md.) in writting to Bill Pulte, Director of the Federal Housing Finance Agency (FHFA), about his unlawful attempt to gut the agency’s independent watchdog responsible for investigating mortgage fraud and Pulte’s own misconduct. The senators called on Pulte to reverse course and fully fund the office. Congress created FHFA’s OIG, and FHFA is statutorily obligated to ensure that OIG has the resources it needs to complete its mission. The letter follows an official notice from the FHFA OIG warning that Pulte’s budget cut will “eliminate (the OIG’s) capacity to effectively conduct criminal investigation of mortgage, bank, and other fraud schemes involving the entities FHFA regulates.”

“We write after receiving confirmation that the Federal Housing Finance Agency (FHFA) is unlawfully slashing the fiscal year 2027 (FY27) budget of its Office of Inspector General (OIG) to $20 million—a reduction of over sixty percent from the OIG’s FY26 operating budget. The cut is so significant that it will immediately force the OIG to begin winding down its operations,” wrote the Banking Committee Democrats.

“Despite the key role that the FHFA OIG plays in preventing waste, fraud, and abuse, you have reduced the office’s budget to $20 million in FY27. That level of funding will impede FHFA OIG’s ability to complete its statutorily required functions and make it impossible to conduct meaningful oversight of FHFA or the U.S. mortgage finance market,” the Banking Committee Democrats continued. “The OIG has confirmed that the cut will effectively shutter its work, writing: ‘We will be forced to reduce staffing by approximately 70-80% in FY 2027, which will result in the discontinuance of essentially all criminal investigations conducted by our Office of Investigations.’”

“Your decision is unacceptable and yet another example of this Administration’s willingness to flout the law and evade accountability. It also indicates that FHFA is uninterested in finding and eliminating mortgage fraud – an issue that you have repeatedly claimed to prioritize at FHFA. We demand that you immediately reverse course and fully fund the FHFA OIG for FY27 with a budget no less than the OIG’s original FY27 funding request.” the Banking Committee Democrats concluded.

Full text of the letter is available here and below. 

Dear Director Pulte:

We write after receiving confirmation that the Federal Housing Finance Agency (FHFA) is unlawfully slashing the fiscal year 2027 (FY27) budget of its Office of Inspector General (OIG) to $20 million—a reduction of over sixty percent from the OIG’s FY26 operating budget. The cut is so significant that it will immediately force the OIG to begin winding down its operations. We demand that FHFA reverse course and fully fund its OIG for FY27 at an amount no less than $57.6 million, the FHFA OIG’s original FY27 funding request. You must publicly answer to Congress about your attempt to gut your agency’s independent watchdog.

FHFA is responsible for the supervision, regulation, and housing mission oversight of the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac), and the Federal Home Loan Bank System. It exercises control over “trillions of dollars in assets and billions of dollars in revenue and makes business and policy decisions affecting the entire U.S. mortgage finance industry.” The FHFA OIG plays a key role as an independent watchdog preventing waste, fraud, and abuse, and ensuring that your agency follows the law. In addition, the OIG leads investigations into misconduct involving FHFA’s programs and operations, including fraud. The FHFA OIG maintains “a highly trained and skilled cadre of financial crimes special agents…and analysts to detect, investigate, and refer for prosecution mortgage fraud and other crimes involving the regulated entities.” Since 2011, its criminal enforcement program has secured “more than 1,270 convictions and nearly $75 billion in monetary results.” It is also statutorily required to conduct certain reviews of FHFA operations. 

FHFA and its OIG are funded through annual assessments that FHFA collects from the entities it regulates. FHFA is required by federal law to assess funding “sufficient to provide for reasonable costs…and expenses of the Agency,” including the OIG. Each year, the OIG sends FHFA an annual request for funding, and “prior to FY 2027, without exception,” FHFA “timely transferred” assessments to OIG “to fund [its] operations.” The FHFA OIG submitted an original FY27 budget request to FHFA of $57.6 million.

Despite the key role that the FHFA OIG plays in preventing waste, fraud, and abuse, you have reduced the office’s budget to $20 million in FY27. That level of funding will impede the FHFA OIG’s ability to complete its statutorily required functions and make it impossible to conduct meaningful oversight of FHFA or the U.S. mortgage finance market. The OIG has confirmed that the cut will effectively shutter its work, writing: “We will be forced to reduce staffing by approximately 70-80% in FY 2027, which will result in the discontinuance of essentially all criminal investigations conducted by our Office of Investigations. Simply stated, funding at the $20 million level will eliminate our capacity to effectively conduct criminal investigation of mortgage, bank, and other fraud schemes involving the entities FHFA regulates.” 

Your decision is unacceptable and yet another example of this Administration’s willingness to flout the law and evade accountability. It also indicates that FHFA is uninterested in finding and eliminating mortgage fraud—an issue that you have repeatedly claimed to prioritize at FHFA.

We demand that you immediately reverse course and fully fund the FHFA OIG for FY27 with a budget no less than the OIG’s original FY27 funding request.

Sincerely,