Charles Gasparino: Banks to Blame Fannie Mae, Freddie Mac (BAC, JPM, WFC)

November 11, 2010 5:19 PM
According to a report from Fox Business Network's Charles Gasparino, the executives of the big banks called before the Senate Banking Committee next week will likely blame Fannie Mae and Freddie Mac when asked about fraud allegations and abuse in the process of mortgage foreclosures.

Banks are facing multiple investigations including one conducted by state attorney's general that is looking into whether banks ignored legal procedures when they foreclosed on homes.

Banks that will have executives present at next week's hearing include JPMorgan (NYSE: JPM), Bank of America (NYSE: BAC) and possibly Wells Fargo (NYSE: WFC).

Gasparino says that the executives will explain that "some of the problems in the foreclosure process relate to the fact that the majority of the loans in question were originated by both Fannie Mae and Freddie Mac, which have their own Byzantine rules."

Gasparino thinks that Republicans are going to use the defense of the banks to attack the Obama administration's current plan to revive Fannie and Freddie down the road.

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