FHFA Accused of Blocking Watchdog Oversight and Cutting Funding

The Federal Housing Finance Agency (FHFA) is facing allegations of obstructing its internal watchdog in an effort to block oversight of Fannie Mae, Freddie Mac, and other housing lenders. In a report sent to lawmakers on October 30, 2026, the agency's Office of Inspector General (OIG) alleged that the FHFA refused to provide records during at least three separate evaluations.

Acting OIG head James Hodge warned that the FHFA drastically reduced the watchdog's funding a month ago, a move that could cut up to 80% of its staff. Hodge stated these cuts would prevent the OIG from conducting meaningful oversight of the agency going forward.

The FHFA, led by Director Bill Pulte, denied the allegations and maintained that it has cooperated with the watchdog. Agency officials defended the budget reductions as a necessary correction of an outsized headcount. This conflict emerges as the FHFA has become more politicized under Pulte, who appointed himself chairman of the Fannie and Freddie boards and has initiated criminal referrals against political figures.