Fannie Mae chief pans bonus tax bill

March 20, 2009 at 5:24 PM
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WASHINGTON, March 20 (UPI) -- The chief executive officer of the Federal National Mortgage Association, Herbert Allison, said he disapproved of a punitive U.S. bonus tax measure.

Allison is a government appointee, assigned to take over Fannie Mae when it fell into federal conservatorship last fall. As other financial executives expressed concern that a measure intended to recoup bonus pay from bailout recipients could backfire, Allison voiced his disapproval Friday, The Washington Post reported.

"I am deeply concerned that eliminating our retention plan would jeopardize our ability to fulfill the mission the government has given us to address the housing crisis," he said.

Others have said, no matter how it looks, the bonus pay system is simply how pay is doled out on Wall Street, even to lower level employees, the report said.

At Fannie Mae, portions of bonus checks are defined as rewards for longevity and handed out on a delayed schedule.

The House of Representatives passed one version of a bonus-tax bill Thursday, while the Senate will take up another version next week. Both versions name Fannie Mae and the Federal Home Loan Mortgage Corp. -- Freddie Mac -- directly, the Post reported.

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