Bill Pulte Asks Congress to Give FHFA Direct Authority To Prosecute Mortgage Fraud

The Federal Housing Finance Agency has called for broader authority to prosecute suspected mortgage fraud—even as Director Bill Pulte's actions have landed scrutiny from the Government Accountability Office.

The FHFA has asked Congress for statutory authority to bring enforcement actions for mortgage fraud, according to its annual report, which was released on Monday. The report recommended that FHFA be given new powers that it says will "enable robust action against fraud and other financial crimes."

In the report, the agency asks either for the authority to bring mortgage fraud actions in federal or state courts or for Congress to create a federal civil cause of action to prosecute these cases.

"FHFA believes that all federal regulators of mortgage market participants should be empowered to take action against fraud in the housing finance market," the report reads. "FHFA’s current authorities in this area are indirect or limited."

The request lines up with a broader push by the Trump administration to root out fraud. Pulte, who has led FHFA since early 2025, has championed several prominent mortgage fraud investigators. Democrats have castigated those investigations as a politicization of the FHFA.

The FHFA didn't respond to a request for further details on the requested authority.

Contentious topic

FHFA gets tips on suspected fraud from its regulated entities—the 11 Federal Home Loan Banks, Fannie Mae, and Freddie Mac. Currently, it can pass those tips along to state or federal regulatory enforcement authorities.

It can also issue suspension orders to ban convicted fraudsters from doing business with it or a regulated entity. But it says that the ability to bring disputes directly is necessary to root out fraud, stating that its current legal enforcement remedies are limited.

"In limited circumstances, FHFA may bring an enforcement action against a contractual counterparty who fails to ensure the eligibility of loans delivered or pledged," it said.

The first option—which would allow the agency "to bring any action for mortgage fraud that its regulated entity could bring in federal or State court"—is akin to the IRS' ability to launch lawsuits against people for longstanding, unpaid taxes.

So-called reduction-to-judgment lawsuits allow the IRS to request a district court judge suspend the typical three-year statute of limitations on tax collection, usually in cases with large outstanding debts it believes to be collectible.

The latter option—"creating a federal civil cause of action for mortgage fraud and granting FHFA authority to bring such actions in federal district court"—could take a similar form to the authority that the Securities and Exchange Commission has to impose civil penalties on people for insider trading.

The FHFA also said in the report that it wants more authority to examine third-party service providers. The agency says it is currently constrained by its statutory authority.The

Pulte's investigations scrutinized

Democrats have been widely critical of Pulte in his leadership of FHFA. Especially as he pushed investigations of Fed board member Lisa Cook and Sen. Adam Schiff (D-California) related to mortgage fraud. Neither investigation has yet led to any criminal charges.

Pulte's position in the Trump administration once again became a sticking point among Democrats and Republicans alike after Trump announced he would elevate him to the position of acting director of national intelligence at the end of this month, despite the 38-year-old having no experience in the intelligence field.

Trump has since said Pulte, who remains FHFA head, isn't in the running for the job permanently.

A group of lawmakers subsequently requested the Government Accountability Office to research whether Pulte abused his authority in pursuing the mortgage fraud investigations. Sen. Elizabeth Warren (D-Massachusetts), ranking member of the Senate Banking, Housing, and Urban Affairs Committee and one of Pulte's loudest critics, led the charge.

The GAO launched the investigation late last year. In a statement to Realtor.com®, it said that the investigation is ongoing.

"GAO has begun work reviewing FHFA’s mortgage fraud investigation process and any recent changes into the process," it said. "The focus is to review FHFA's process for handling allegations of mortgage fraud, as well its safeguarding of personal mortgage information. This work is underway and expected to issue in late 2026 or early 2027."