"Fixers" Fail to Keep Mortgage Execs' Parachutes Golden

ParachuteAfter taking control of mortgage giants Fannie Mae and Freddie Mac, the U.S. government told their former chief executives that the "'golden parachute' payments contemplated under their contracts would not be paid." The executives, Daniel Mudd and Richard Syron, "together were eligible to receive as much as $25 million" in severance -- or "golden parachute" -- payments, reports the Washington Post. Imagine what would have happened if Mudd and Syron had not "hired two of the nation's best-regarded fixers." Freddie Mac's Syron hired George Sard, the head of the public relations firm Sard Verbinnen & Co, at his own expense. The firm's clients have included home-living guru Martha Stewart, former New York Governor Eliot Spitzer and talk show host Nancy Grace. Sard said Syron didn't want "a windfall," just enough to assist with the transition. Fannie Mae's Mudd hired "high-profile Washington lawyer Robert B. Barnett ... with fees to be paid by Fannie Mae." Barnett's former clients include both Bill and Hillary Clinton, Republican strategist Karl Rove and former Federal Reserve Chair Alan Greenspan. In related news, the mortgage giants are no longer able to lobby. The restriction hit former Fannie Mae lobbyists at Ogilvy Public Relations, Johnson Madigan and Bryan Cave Strategies, among other firms, reports O'Dwyer's.


The [http://online.wsj.com/article/SB122151799460638921.html Wall Street Journal] (sub req'd) reports that Mudd and Syron will keep their pensions and 401(k) savings plans:

"Mr. Mudd's pension and 401k plan has an estimated current value of $5.6 million ... and for Mr. Syron the figure is $4 million. But the FHFA [Federal Housing Finance Agency, which now has authority over Fannie Mae and Freddie Mac] won't allow additional severance payments of about $2.3 million that could have gone to Mr. Mudd and $10.3 million for Mr. Syron."