As usual Jeremy Bagott nailed the corruption (8/30/24) in his email:
"On August 28, the U.S. Government Accountability Office published its finding that the federal agency, known by the tortuous name the Appraisal Subcommittee of the Federal Financial Institutions Examination Council, had violated its authorizing statute when it awarded the $1 million to the 10-employee Nicholasville, Kentucky, nonprofit run by a man who, at the time, reported he was living in the United Kingdom.
The ostensible beneficiary in the arrangement, a nonprofit known as the Council on Licensure, Enforcement and Regulation, Inc., distributed a press release in 2021 announcing the $1 million deal with the federal regulator. Unfortunately, the money was not the regulator’s to spend. It must have seemed like manna from heaven to the boutique nonprofit that reported a total revenue of $2 million in 2019.
The GAO found the tiny federal agency had violated the “purpose statute.” When the GAO reports this, it means a federal agency has used funds for a purpose other than what Congress intended. The tiny regulatory agency also violated the Antideficiency Act, according to the GAO.
The agency is now trying to claw back the money.
But the story doesn’t end there, although it’s not addressed by the GAO. Using the Kentucky nonprofit as a cutout, the federal regulator solicited a “study” that managed to funnel $242,250 of the million dollars to a second nonprofit known as the National Fair Housing Alliance. In doing this, the federal agency skirted Title 41 federal procurement laws. You can view the Kentucky nonprofit’s request for proposal here and the resulting contract here.
The National Fair Housing Alliance, which raked in more than $13 million in private grants and contributions in 2023 and more than $25 million in total revenue the year prior, has successfully captured a corner of the U.S. Department of Housing and Urban Development, which it teams with to malign the nation’s state-licensed appraisers. It uses HUD’s seal on co-branded ads that solicit plaintiffs for itself and HUD-affiliated attorneys in shakedown lawsuits. The housing lobby is the prime beneficiary of its efforts, and the arrangement has done tremendous damage in the form of runaway home prices as appraisers have been intimidated, weakened or sidelined altogether in federally backed mortgage transactions.
In the web is a University of Texas-trained lawyer and activist called Zixta Q. Martinez. She is chair of the scofflaw regulator. Besides her duties there, she is deputy director at the federal Consumer Financial Protection Bureau. She’s also a former employee of the National Fair Housing Alliance.
With the nonprofit’s help, HUD has ensnared at least 300, but possibly as many as 1,000, state-licensed real property appraisers in federal investigations based, by all accounts, only on the fact that an appraiser failed to hit a predetermined value required to make a real estate transaction pencil.
The censorship, scapegoating and sidelining of appraisers has also done real damage to borrowers and the purchasers of bonds issued by the government-sponsored mortgage giants Fannie Mae and Freddie Mac. Housing prices can no longer easily correct as the data pool has been tainted by closed transactions with rubber-stamped or contrived values due to institutional bullying of appraisers and the waiving of appraisals.
In May, Fitch Ratings estimated national home prices were 11.1% overvalued. That’s likely understating it. Appraisers are a key bulwark. At the end of the day, they protect taxpayers in federally related mortgages. For America’s housing economy to function, appraisers must be able to occasionally conclude values that send buyers, sellers and their commissioned brokers back to the negotiating table.
It’s amazing what mayhem a million dollars can buy when applied to the right people."
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The 'stakeholders' are being shown to be more like vultures.
