Bill Pulte Asks Congress for FHFA Authority to Prosecute Mortgage Fraud

The Federal Housing Finance Agency (FHFA) 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, recommending that it 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 power to bring mortgage fraud actions in federal or state courts, or it wants to see Congress create a federal civil cause of action that it could then use to bring suspected fraudsters to court.

“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 politicization of the FHFA.

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

Contentious topic

FHFA gets tips about suspected fraud from its regulated entities—the 11 Federal Home Loan Banks, Fannie Mae and Freddie Mac. Currently, it can then pass those 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 somewhat akin to the IRS’ ability to launch lawsuits against people for longstanding, unpaid taxes.

So-called reduction-to-judgment lawsuits allow the IRS 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 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. It says it is currently constrained from that by its statutory authority.

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 has yet led to any criminal charges.)

Most recently, they’ve arisen again as a sticking point among Democrats and Republicans alike after Trump announced he would elevate Pulte to 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 if 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.

GAO then launched the investigation late last year. In a statement to Realtor.com, it said that investigation is still 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.”