Tags: Feds | Exempt | From | Mortgage | Privacy | Notices

Feds Exempt From Mortgage Privacy Notices

Wednesday, 23 May 2001 12:00 AM

If your mortgage is covered by Fannie Mae or Freddie Mac, you likely won’t even be asked whether you wish to "opt out” of having your name, personal financial information and Social Security number exchanged with other marketers or entities.

The Congressional Budget Office (CBO) reports Fannie Mae and Freddie Mac, as Government Subsidized Enterprises (GSEs), are exempt from such requirements in last year’s Gramm-Leach-Bliley Act. In many other ways, that law is viewed by many privacy advocates to be as full of holes as Swiss cheese.

Despite the fact that the GSEs keep more than a third of their taxpayer subsidies for themselves, Fannie Mae and Freddie Mac successfully lobbied to get an exemption from the privacy rules enacted by Gramm-Leach-Bliley.

In calling attention to the CBO report Wednesday, J. Bradley Jansen of the Free Congress Foundation said this "should be a wake-up call to Congress that Fannie Mae and Freddy Mac are the poster children for corporate welfare.”

Some have used less charitable descriptions of these two taxpayer-subsidized entities, even comparing their structure to the corporate fascism of Mussolini’s Italy.

Through their automated underwriting systems, Fannie Mae and Freddie Mac collect sensitive information on millions of Americans, but are immune from the rules governing the exchange of that data. The two corporations got the loophole by lobbying hard in a conference committee of Senate and House negotiators.

"While Americans are sifting through more than 2.5 billion privacy notices that financial institutions are required by law to distribute,” says Jansen, "the GSEs are off the hook.”

He says because the CBO report was incomplete, "we don’t know how many millions of dollars the privacy loophole saves the GSEs.” He says that savings should be accounted for "in any future subsidy analysis” conducted by CBO.

"Do we really need subsidized GSEs that violate our financial privacy?” Jansen asks.

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If your mortgage is covered by Fannie Mae or Freddie Mac, you likely won't even be asked whether you wish to opt out" of having your name, personal financial information and Social Security number exchanged with other marketers or entities. The Congressional Budget...
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Wednesday, 23 May 2001 12:00 AM
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