WASHINGTON — The Federal Housing Finance Agency is asking Congress for expanded authority to pursue mortgage fraud cases directly, arguing that its current enforcement tools are too limited to effectively combat fraud in the housing finance system, according to a report cited by Realtor.com.
In its annual report, the FHFA called for new statutory powers that would allow it to bring mortgage fraud cases in federal or state courts or, alternatively, for Congress to create a federal civil cause of action specifically for mortgage fraud, Realtor.com reported.
The agency said the additional authority would “enable robust action against fraud and other financial crimes” and strengthen its ability to police misconduct in the housing market.
“FHFA believes that all federal regulators of mortgage market participants should be empowered to take action against fraud in the housing finance market,” the agency said in the report, according to Realtor.com. “FHFA’s current authorities in this area are indirect or limited.”
The FHFA oversees government-sponsored mortgage giants Fannie Mae and Freddie Mac, as well as the nation’s 11 Federal Home Loan Banks.
Tools Deemed Insufficient
According to Realtor.com, the agency currently receives tips regarding suspected fraud from those regulated entities and can refer cases to federal or state enforcement authorities. It also has authority to issue suspension orders that prohibit individuals convicted of fraud from doing business with the agency or its regulated entities.
However, the FHFA said those tools are insufficient and that direct legal authority is needed to better address fraud.
“In limited circumstances, FHFA may bring an enforcement action against a contractual counterparty who fails to ensure the eligibility of loans delivered or pledged,” the agency said in the report, according to Realtor.com.
Two Proposals
One proposal outlined by the FHFA would allow the agency to bring any mortgage fraud action that one of its regulated entities could bring in federal or state court. Realtor.com reported that the approach would resemble the authority exercised by the Internal Revenue Service in certain tax collection cases.
A second proposal would establish a federal civil cause of action for mortgage fraud and grant the FHFA authority to pursue such cases in federal district court. Realtor.com reported that such authority could resemble powers held by the Securities and Exchange Commission in insider trading enforcement actions.
The agency also requested broader authority to examine third-party service providers, saying its current statutory authority limits its oversight capabilities, according to the report.
Criticism of Investigations
The request comes as the Trump administration has emphasized efforts to combat fraud across federal programs and agencies. Realtor.com reported that FHFA Director Bill Pulte, who has led the agency since early 2025, has supported several high-profile mortgage fraud investigations.
Those investigations have drawn criticism from Democrats, who have accused the agency of politicizing its enforcement activities. Among the investigations highlighted by Realtor.com were reviews involving Lisa Cook and Adam Schiff. Realtor.com reported that neither investigation has resulted in criminal charges.
GAO Urged to Investigate
Separately, a group of lawmakers has asked the Government Accountability Office to examine whether Pulte improperly used his authority in pursuing mortgage fraud investigations. Realtor.com reported that the request was led by Elizabeth Warren, the ranking Democrat on the Senate Banking Committee.
In a statement to Realtor.com, the GAO said its review is ongoing.
“GAO has begun work reviewing FHFA’s mortgage fraud investigation process and any recent changes into the process,” the agency 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.”
The FHFA did not provide additional details regarding the requested enforcement authority, according to Realtor.com.
