The Federal Housing Finance Agency under Director Bill Pulte has repeatedly blocked its internal watchdog from accessing essential records, according to an oversight report transmitted to lawmakers on Friday. Prepared earlier this month by the agency’s Office of Inspector General, the report characterizes the resistance as an unprecedented obstruction of congressionally mandated reviews examining federal oversight of mortgage giants Fannie Mae and Freddie Mac alongside other lenders.
The findings intensify an ongoing conflict between the housing regulator and its internal inspector general. The dispute aligns with broader administration efforts to constrain independent inspectors general tasked with identifying waste, fraud, and mismanagement across federal departments.
The inspector general’s report states that the housing agency withheld records during at least three separate evaluations. Among them was an assessment focused on a multifamily lender involved in loans that defaulted in June 2024. The OIG general counsel attempted to resolve the impasse by presenting documentation outlining the office’s statutory mandate to access all necessary records, briefly reaching an informal understanding in mid-August. However, two weeks following that discussion, the agency notified the inspector general that it was drastically slashing the office’s funding.
An agency spokesperson disputed the report’s conclusions, asserting that the housing regulator has readily produced information and fully cooperated with oversight staff. The spokesperson noted that agency personnel recently completed 56 document requests and participated in 16 separate hour-long meetings for three recent reviews, maintaining that the regulator respects the inspector general’s independence.
The Federal Housing Finance Agency oversees Fannie Mae, Freddie Mac, and the Federal Home Loan Banks, government-sponsored enterprises that support the majority of U.S. mortgages. Since taking office in March 2025, Pulte has transformed the traditionally quiet regulatory body into a more politicized institution. Shortly after confirmation, Pulte appointed himself chairman of both the Fannie Mae and Freddie Mac boards, subsequently removing the acting inspector general and reducing staff counts across the regulator and mortgage enterprises.
Budget cuts implemented a month ago reduced funding for the inspector general’s office, with staff informed that up to 80% of personnel—roughly 80 positions—could face elimination. Acting Inspector General James Hodge warned lawmakers earlier this month that the funding reductions would cripple the watchdog’s ability to function. Although OIG leaders have conferred with members of Congress to prevent the layoffs, staff members have received furlough notices in preparation for workforce reductions.
The agency has defended the budget reductions by arguing that the inspector general’s funding and headcount were disproportionately large compared to those of similar regulators. Friday’s report to Congress marks the first instance in at least a decade that the internal watchdog has officially flagged interference with its independence in its semiannual reporting.
“The unprecedented and abrupt cuts will prevent OIG from conducting meaningful oversight of FHFA going forward,” the report concluded, describing the funding reduction as an extreme escalation against the watchdog’s authority.
