Scott Garrett: “I rise today to compliment both Chairman Baker and Chairman Oxley for their work in order to put together a bill that…”

“I rise today to compliment both Chairman Baker and Chairman Oxley for their work in order to put together a bill that the main purpose which is to regulate and strengthen the regulation of Fannie Mae and Freddie Mac. If anyone here questions the need for additional remedies such as regulations, all we have to do is look at a brief history going back a couple of years of these two entities. Back in January of 2003, Freddie Mac issued a press release and stated it will issue an unaudited statement of earnings for the year 2002 and restate accounting results for prior years. November of the next year, November 2003, Freddie issues a restatement of past accounting results for the year 2000, 2001, 2002, and revises its net earnings upwards by $4.4 billion that they were off in their records. September of 2004, OFHEO makes public a report highly critical of accounting methods of Fannie Mae. November of 2004, Fannie announces that it is unable again to file a third-quarter earning statement because its auditor, KPMG, refused to sign off on the accounting results. December of 2004, the Securities and Exchange Commission, the SEC, issues a statement supporting OFHEO's report and orders Fannie to restate its financial results. Again, in December of 2004, the Fannie CEO Franklin Raines and CFO Tim Howard have to resign from those entities. Finally, in June of 2005, after 3 years, finally Freddie issues its first audited annual report since the year 2002.…”