The other Freddie of nightmarish proportions (UPDATED)

You’ll be pleased to know that the Feds are taking swift action with respect to bonuses paid to executives of large financial institutions… particularly those that are taxpayer funded.

The government-controlled mortgage finance company is giving CFO Ross Kari compensation worth as much as $5.5 million. That includes an almost $2 million cash signing bonus and a generous salary that could top $2.3 million.

The Federal Housing Finance Agency, which oversees Freddie Mac, approved the pay package. A spokeswoman pointed to a statement that justified the agency's approval of the pay, which was done in part because the amount was comparable to what others in the financial services industry make.

This is the sort of hard-hitting action that we can expect now and in the future with respect to this government-sponsored entity (GSE) which has had $51 billion in taxpayer dollars pumped into it over the last calendar year and which was front and center in the subprime meltdown which started last year.

The White House and Congress which has been so intent upon tying pay to performance or not indulging the bad behavior of Wall St. does not seem so intent in doing the same or expressing the same moral indignation when it comes to one of their own.


(UPDATE #1): Good news/bad news on the Chris Dodd/Countrywide front.

At last, there's some good news for taxpayers in the Countrywide Financial loan scandal. On Friday night, House oversight committee chairman Edolphus Towns (D., N.Y.) and ranking member Darrell Issa (R., Calif.) reached an agreement to subpoena documents from the "Friends of Angelo" program. Named for former Countrywide CEO Angelo Mozilo, the program provided VIP mortgages to "friends" including Senators Chris Dodd and Kent Conrad.

Said Mr. Towns, "In line with the commitment to an ethical and accountable Congress, the subpoena to Countrywide covers records that could show special treatment for Members of Congress." This is significant, because a compromise plan floated last week would have authorized a subpoena covering—don't laugh—all federal officials except members of Congress.

Actually, passing that legislation would've made perfect sense in the most ethical Congress, evah.

But now for the bad, if not entirely predictable news.

But Monday's Wall Street Journal report about Countrywide Financial Corp., which refinanced mortgages for Dodd in 2003, threatens to put the brakes on his comeback by reinvigorating the issue that got him in trouble to begin with.

According to the Journal's account (subscription req'd.),Countrywide recorded phone conversations with borrowers in the controversial mortgage program that included public officials, but those recordings have been destroyed.

Now, we are in no way implying that those brave Congressmen who stood on ethics in getting that subpoena agreement had any foreknowledge - not in any way shape or form. It just seems to us, however, that these sudden fits of integrity are often bolstered by the fact that, you know, stuff happens.