The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
FOLEY
ATTORNEYS AT LAW
FOLEY & LARDNER LLP
December 10, 2010
WASHINGTON HARBOUR
3000 K STREET, N.W.
SUITE 600
WASHINGTON, D.C. 20007-5109
202.672.5300 TEL
202.672.5399 FAX
foley.com
WRITER'S DIRECT LINE
202.672.5528
kwiner@foley.com EMAIL
CLIENT /MATTER NUMBER
023422-0102
Gary Cohen, Esq.
FCIC
1717 Pennsylvania Avenue, N.W.
Suite 800
Washington, D.C. 20006
Re:
FCIC - Mark Winer
Dear Mr. Cohen:
I am writing on behalf of Mark Winer. Thank you for providing us with notice
that the FCIC is considering including the following paragraph in its Report to Congress, the
President and the American public. We think the provision of such notice is highly desirable.
Mark Winer, head of Fannie's Business, Analysis and
Development Group since May 2006, was responsible for
calculating the fees and raised concerns that Fannie Mae was not
appropriately pricing the risk. His chief, Executive Vice President
Rob Levin, disregarded his input, asking, "Can you show me why
you think you're right and everyone else is wrong ... "
The proposed paragraph is inconsistent both with Mr. Winer's recollection and with the MFR
that the FCIC recently provided to Mr. Winer. Although we do not believe that the MFR is a
reliable record of the interview, it is instructive to point out disparities between the proposed
paragraph and the MFR:
•
The proposed paragraph describes Mr. Winer's unit as "Fannie's Business, Analysis and
Development Group." (emphasis added) The MFR indicates that in the Spring of2006,
Mr. Winer was appointed Senior Vice President for Business Analytics and Decisions
("BA&D")(emphasis added). MFR at 2.
•
The proposed paragraph states that Mr. Winer "was responsible for calculating the fees."
The MFR discusses model fees that were generated by BA&D, MFR at 6, 8 and indicates
both that Mr. Winer stated that model fees "are only one factor in determining the right
price, " MFR at 13, and that Mr. Winer stated that the Single Family business decided
what fees to charge, which could be less than the model fee. MFR at 13.
BOSTON
BRUSSELS
CHICAGO
DETROIT
JACKSONVILLE
LOS ANGELES
MADISON
MIAMI
MILWAUKEE
NEW YORK
ORLANDO
SACRAMENTO
SAN DIEGO
SAN DIEGO/DEL MAR
SAN FRANCISCO
SHANGHAI
SILICON VALLEY
TALLAHASSEE
TAMPA
TOKYO
WASHINGTON, D.C.
WASH_7563777.1
:FOLEY
FOLEY & LARDNER LLP
Gary Cohen, Esq.
December 10, 2010
Page 2
•
The proposed paragraph stated that Mr. Levin "disregarded" Mr. Winer's input. The
MFR does not contain any statement that Mr. Levin "disregarded" Mr. Winer's input. To
the contrary, the MFR states that the model fees were sometimes higher that the market
prices and the prices that Fannie Mae charged, MFR at 4, 5, and states that Mr. Winer
identified Mr. Levin as "critical of models" and as asking Mr. Winer whether Mr. Winer
could show why Mr. Winer thought BA&D was right and everyone else was wrong,
MFR at 8.
•
The proposed paragraph states that Mr. Winer "raised concerns that Fannie Mae was not
appropriately pricing the risk." Although the MFR does indicate that Mr. Winer believed
that in the second half of 2006 and first half of 2007 the charged fees for Alt-A
mortgages did not adequately compensate FNMA for risk, the MFR does not indicate that
Mr. Winer concluded that the charged fees therefore were inappropriate or that Mr.
Winer thought that he was in a position reliably to assess the appropriateness ofthe fees
charged by the single family business in light of the other relevant considerations.
Indeed, the MFR indicates that Mr. Winer stated that model fees "are only one factor in
determining the right price." MFR at 13.
We appreciate your having provided this opportunity to comment on the proposed
paragraph. We hope that our comments will assist the FCIC in accomplishing its important task
of providing an accurate and informative report to the Congress, the President and the American
people.
Best Regards,
Kenneth B. Winer
KBW:vdta
cc:
Jeffrey Kilduff, Esq., O'Melveny & Myers LLP
Cassidy W askowicz
Sarah Zuckerman
Sarah Knaus
WASH_7563777 .1
@FedFRASER