12 U.S.C. § 1723a : US Code - Section 1723A: General powers of Government National Mortgage Association and Federal National Mortgage Association

Search 12 U.S.C. § 1723a : US Code - Section 1723A: General powers of Government National Mortgage Association and Federal National Mortgage Association

(a) Seal, and other matters incident to operation
Each of the bodies corporate named in section 1717(a)(2) of this
title shall have power to adopt, alter, and use a corporate seal,
which shall be judicially noticed; to enter into and perform
contracts, leases, cooperative agreements, or other transactions,
on such terms as it may deem appropriate, with any agency or
instrumentality of the United States, or with any State, Territory,
or possession, or the Commonwealth of Puerto Rico, or with any
political subdivision thereof, or with any person, firm,
association, or corporation; to execute, in accordance with its
bylaws, all instruments necessary or appropriate in the exercise of
any of its powers; in its corporate name, to sue and to be sued,
and to complain and to defend, in any court of competent
jurisdiction, State or Federal, but no attachment, injunction, or
other similar process, mesne or final, shall be issued against the
property of the Association or against the Association with respect
to its property; to conduct its business without regard to any
qualification or similar statute in any State of the United States,
including the District of Columbia, the Commonwealth of Puerto
Rico, and the Territories and possessions of the United States; to
lease, purchase, or acquire any property, real, personal, or mixed,
or any interest therein, to hold, rent, maintain, modernize,
renovate, improve, use, and operate such property, and to sell, for
cash or credit, lease, or otherwise dispose of the same, at such
time and in such manner as and to the extent that it may deem
necessary or appropriate; to prescribe, repeal, and amend or
modify, rules, regulations, or requirements governing the manner in
which its general business may be conducted; to accept gifts or
donations of services, or of property, real, personal, or mixed,
tangible, or intangible, in aid of any of its purposes; and to do
all things as are necessary or incidental to the proper management
of its affairs and the proper conduct of its business.
(b) Determination with respect to obligations and expenditures
Except as may be otherwise provided in this subchapter, in
chapter 91 of title 31, or in other laws specifically applicable to
Government corporations, the Association shall determine the
necessity for and the character and amount of its obligations and
expenditures and the manner in which they shall be incurred,
allowed, paid, and accounted for.
(c) Exemption from taxation
(1) The Association, including its franchise, capital, reserves,
surplus, mortgages or other security holdings, and income shall be
exempt from all taxation now or hereafter imposed by the United
States, by any territory, dependency, or possession thereof, or by
any State, county, municipality, or local taxing authority, except
that any real property of the Association shall be subject to
State, territorial, county, municipal, or local taxation to the
same extent according to its value as other real property is taxed.
(2) The corporation, including its franchise, capital, reserves,
surplus, mortgages or other security holdings, and income, shall be
exempt from all taxation now or hereafter imposed by any State,
territory, possession, Commonwealth, or dependency of the United
States, or by the District of Columbia, or by any county,
municipality, or local taxing authority, except that any real
property of the corporation shall be subject to State, territorial,
county, municipal, or local taxation to the same extent as other
real property is taxed.
(d) Appointment and compensation of personnel; use of services of
other agencies
(1) Subject to the provisions of section 1723(a) of this title,
the Secretary of Housing and Urban Development shall have power to
select and appoint or employ such officers, attorneys, employees,
and agents of the Association, to vest them with such powers and
duties, and to fix and to cause the Association to pay such
compensation to them for their services, as he may determine,
subject to the civil service and classification laws. With the
consent of any Government corporation or Federal Reserve bank, or
of any board, commission, independent establishment, or executive
department of the Government, the Association may avail itself on a
reimbursable basis of the use of information, services, facilities,
officers, and employees thereof, including any field service
thereof, in carrying out the provisions of the subchapter.
(2) The board of directors of the corporation shall have the
power to select and appoint or employ such officers, attorneys,
employees, and agents, to vest them with such powers and duties,
and to fix and to cause the corporation to pay such compensation to
them for their services, as the board of directors determines
reasonable and comparable with compensation for employment in other
similar businesses (including other publicly held financial
institutions or major financial services companies) involving
similar duties and responsibilities, except that a significant
portion of potential compensation of all executive officers (as
such term is defined in paragraph (3)(C)) of the corporation shall
be based on the performance of the corporation; and any such action
shall be without regard to the Federal civil service and
classification laws. Appointments, promotions, and separations so
made shall be based on merit and efficiency, and no political tests
or qualifications shall be permitted or given consideration. Each
officer and employee of the corporation who is employed by the
corporation prior to January 31, 1972, and who on the day previous
to the beginning of such employment will have been subject to the
civil service retirement law (subch. III of ch. 83 of title 5)
shall, so long as the employment of such officer or employee by the
corporation continues without a break in continuity of service,
continue to be subject to such law; and for the purpose of such law
the employment of such officer or employee by the corporation
without a break in continuity of service shall be deemed to be
employment by the Government of the United States. The corporation
shall contribute to the Civil Service Retirement and Disability
Fund a sum as provided by section 8334(a) of title 5, except that
such sum shall be determined by applying to the total basic pay (as
defined in section 8331(3) of title 5 and except as hereinafter
provided) paid to the employees of the corporation who are covered
by the civil service retirement law, the per centum rate determined
annually by the Director of the Office of Personnel Management to
be the excess of the total normal cost per centum rate of the civil
service retirement system over the employee deduction rate
specified in section 8334(a) of title 5. The corporation shall also
pay into the Civil Service Retirement and Disability Fund such
portion of the cost of administration of the fund as is determined
by the Director of the Office of Personnel Management to be
attributable to its employees. Notwithstanding the foregoing
provisions, there shall not be considered for the purposes of the
civil service retirement law that portion of the basic pay in any
one year of any officer or employee of the corporation which
exceeds the basic pay provided for positions listed in section 5312
of title 5 on the last day of such year: Provided, That with
respect to any person whose employment is made subject to the civil
service retirement law by section 806 of the Housing and Community
Development Act of 1974, there shall not be considered for the
purposes of such law that portion of the basic pay of such person
in any one year which exceeds the basic pay provided for positions
listed in section 5316 of such title 5 on the last day of such
year. Except as provided in this subsection, the corporation shall
not be subject to the provisions of title 5.
(3)(A) Not later than June 30, 1993, and annually thereafter, the
corporation shall submit a report to the Committee on Banking,
Finance and Urban Affairs of the House of Representatives and the
Committee on Banking, Housing, and Urban Affairs of the Senate on
(i) the comparability of the compensation policies of the
corporation with the compensation policies of other similar
businesses, (ii) in the aggregate, the percentage of total cash
compensation and payments under employee benefit plans (which shall
be defined in a manner consistent with the corporation's proxy
statement for the annual meeting of shareholders for the preceding
year) earned by executive officers of the corporation during the
preceding year that was based on the corporation's performance, and
(iii) the comparability of the corporation's financial performance
with the performance of other similar businesses. The report shall
include a copy of the corporation's proxy statement for the annual
meeting of shareholders for the preceding year.
(B) Notwithstanding the first sentence of paragraph (2), after
October 28, 1992, the corporation may not enter into any agreement
or contract to provide any payment of money or other thing of
current or potential value in connection with the termination of
employment of any executive officer of the corporation, unless such
agreement or contract is approved in advance by the Director of the
Office of Federal Housing Enterprise Oversight of the Department of
Housing and Urban Development. The Director may not approve any
such agreement or contract unless the Director determines that the
benefits provided under the agreement or contract are comparable to
benefits under such agreements for officers of other public and
private entities involved in financial services and housing
interests who have comparable duties and responsibilities. For
purposes of this subparagraph, any renegotiation, amendment, or
change after October 28, 1992, to any such agreement or contract
entered into on or before October 28, 1992, shall be considered
entering into an agreement or contract.
(C) For purposes of this paragraph, the term "executive officer"
has the meaning given the term in section 1303 of the Federal
Housing Enterprises Financial Safety and Soundness Act of 1992 [12
U.S.C. 4502].
(e) Prohibition against use of names; injunction; damages
No individual, association, partnership, or corporation, except
the bodies corporate named in section 1717(a)(2) of this title,
shall hereafter use the words "Federal National Mortgage
Association," "Government National Mortgage Association," or any
combination of such words, as the name or a part thereof under
which the individual, association, partnership, or corporation
shall do business. Violations of the foregoing sentence may be
enjoined by any court of general jurisdiction at the suit of the
proper body corporate. In any such suit, the plaintiff may recover
any actual damages flowing from such violation, and, in addition,
shall be entitled to punitive damages (regardless of the existence
or nonexistence of actual damages) of not exceeding $100 for each
day during which such violation is committed or repeated.
(f) Preparation of forms of obligations and certificates
In order that the Association may be supplied with such forms of
obligations or certificates as it may need for issuance under this
subchapter, the Secretary of the Treasury is authorized, upon
request of the Association, to prepare such forms as shall be
suitable and approved by the Association, to be held in the
Treasury subject to delivery, upon order of the Association. The
engraved plates, dies, bed pieces, and other material executed in
connection therewith shall remain in the custody of the Secretary
of the Treasury. The Association shall reimburse the Secretary of
the Treasury for any expenses incurred in the preparation, custody,
and delivery of such forms.
(g) Depositaries, custodians, and fiscal agents
The Federal Reserve banks are authorized and directed to act as
depositaries, custodians, and fiscal agents for each of the bodies
corporate named in section 1717(a)(2) of this title, for its own
account or as fiduciary, and such banks shall be reimbursed for
such services in such manner as may be agreed upon; and each of
such bodies corporate may itself act in such capacities, for its
own account or as fiduciary, and for the account of others.
(h), (i) Repealed. Pub. L. 102-550, title XIII, Sec. 1381(k), Oct.
28, 1992, 106 Stat. 3997
(j) Audit; access to books, etc.; report of audit
(1) The programs, activities, receipts, expenditures, and
financial transactions of the corporation shall be subject to audit
by the Comptroller General of the United States under such rules
and regulations as may be prescribed by the Comptroller General.
The representatives of the Government Accountability Office shall
have access to such books, accounts, financial records, reports,
files, and such other papers, things, or property belonging to or
in use by the corporation and necessary to facilitate the audit,
and they shall be afforded full facilities for verifying
transactions with the balances or securities held by depositories,
fiscal agents, and custodians. A report on each such audit shall be
made by the Comptroller General to the Congress. The corporation
shall reimburse the Government Accountability Office for the full
cost of any such audit as billed therefor by the Comptroller
General.
(2) To carry out this subsection, the representatives of the
Government Accountability Office shall have access, upon request to
the corporation or any auditor for an audit of the corporation
under subsection (l) of this section, to any books, accounts,
financial records, reports, files, or other papers, things, or
property belonging to or in use by the corporation and used in any
such audit and to any papers, records, files, and reports of the
auditor used in such an audit.
(k) Financial reports; submission to Director; contents
(1) The corporation shall submit to the Director of the Office of
Federal Housing Enterprise Oversight of the Department of Housing
and Urban Development annual and quarterly reports of the financial
condition and operations of the corporation which shall be in such
form, contain such information, and be submitted on such dates as
the Director shall require.
(2) Each such annual report shall include -
(A) financial statements prepared in accordance with generally
accepted accounting principles;
(B) any supplemental information or alternative presentation
that the Director may require; and
(C) an assessment (as of the end of the corporation's most
recent fiscal year), signed by the chief executive officer and
chief accounting or financial officer of the corporation, of -
(i) the effectiveness of the internal control structure and
procedures of the corporation; and
(ii) the compliance of the corporation with designated safety
and soundness laws.
(3) The corporation shall also submit to the Director any other
reports required by the Director pursuant to section 1314 of the
Federal Housing Enterprises Financial Safety and Soundness Act of
1992 [12 U.S.C. 4514].
(4) Each report of financial condition shall contain a
declaration by the president, vice president, treasurer, or any
other officer designated by the board of directors of the
corporation to make such declaration, that the report is true and
correct to the best of such officer's knowledge and belief.
(l) Independent audits of financial statements
(1) The corporation shall have an annual independent audit made
of its financial statements by an independent public accountant in
accordance with generally accepted auditing standards.
(2) In conducting an audit under this subsection, the independent
public accountant shall determine and report on whether the
financial statements of the corporation (A) are presented fairly in
accordance with generally accepted accounting principles, and (B)
to the extent determined necessary by the Director, comply with any
disclosure requirements imposed under subsection (k)(2)(B) of this
section.
(m) Mortgage data collection and reporting requirements
(1) The corporation shall collect, maintain, and provide to the
Secretary, in a form determined by the Secretary, data relating to
its mortgages on housing consisting of 1 to 4 dwelling units. Such
data shall include -
(A) the income, census tract location, race, and gender of
mortgagors under such mortgages;
(B) the loan-to-value ratios of purchased mortgages at the time
of origination;
(C) whether a particular mortgage purchased is newly originated
or seasoned;
(D) the number of units in the housing subject to the mortgage
and whether the units are owner-occupied; and
(E) any other characteristics that the Secretary considers
appropriate, to the extent practicable.
(2) The corporation shall collect, maintain, and provide to the
Secretary, in a form determined by the Secretary, data relating to
its mortgages on housing consisting of more than 4 dwelling units.
Such data shall include -
(A) census tract location of the housing;
(B) income levels and characteristics of tenants of the housing
(to the extent practicable);
(C) rent levels for units in the housing;
(D) mortgage characteristics (such as the number of units
financed per mortgage and the amount of loans);
(E) mortgagor characteristics (such as nonprofit, for-profit,
limited equity cooperatives);
(F) use of funds (such as new construction, rehabilitation,
refinancing);
(G) type of originating institution; and
(H) any other information that the Secretary considers
appropriate, to the extent practicable.
(3)(A) Except as provided in subparagraph (B), this subsection
shall apply only to mortgages purchased by the corporation after
December 31, 1992.
(B) This subsection shall apply to any mortgage purchased by the
corporation after the date determined under subparagraph (A) if the
mortgage was originated before such date, but only to the extent
that the data referred in paragraph (1) or (2), as applicable, is
available to the corporation.
(n) Report on housing activities; contents; public disclosure
(1) The corporation shall submit to the Committee on Banking,
Finance and Urban Affairs of the House of Representatives, the
Committee on Banking, Housing, and Urban Affairs of the Senate, and
the Secretary a report on its activities under subpart B of part 2
of subtitle A of the Federal Housing Enterprises Financial Safety
and Soundness Act of 1992 [12 U.S.C. 4561 et seq.].
(2) The report under this subsection shall -
(A) include, in aggregate form and by appropriate category,
statements of the dollar volume and number of mortgages on owner-
occupied and rental properties purchased which relate to each of
the annual housing goals established under such subpart;
(B) include, in aggregate form and by appropriate category,
statements of the number of families served by the corporation,
the income class, race, and gender of homebuyers served, the
income class of tenants of rental housing (to the extent such
information is available), the characteristics of the census
tracts, and the geographic distribution of the housing financed;
(C) include a statement of the extent to which the mortgages
purchased by the corporation have been used in conjunction with
public subsidy programs under Federal law;
(D) include statements of the proportion of mortgages on
housing consisting of 1 to 4 dwelling units purchased by the
corporation that have been made to first-time homebuyers, as soon
as providing such data is practicable, and identifying any
special programs (or revisions to conventional practices)
facilitating homeownership opportunities for first-time
homebuyers;
(E) include, in aggregate form and by appropriate category, the
data provided to the Secretary under subsection (m)(1)(B) of this
section;
(F) compare the level of securitization versus portfolio
activity;
(G) assess underwriting standards, business practices,
repurchase requirements, pricing, fees, and procedures, that
affect the purchase of mortgages for low- and moderate-income
families, or that may yield disparate results based on the race
of the borrower, including revisions thereto to promote
affordable housing or fair lending;
(H) describe trends in both the primary and secondary
multifamily housing mortgage markets, including a description of
the progress made, and any factors impeding progress toward
standardization and securitization of mortgage products for
multifamily housing;
(I) describe trends in the delinquency and default rates of
mortgages secured by housing for low- and moderate-income
families that have been purchased by the corporation, including a
comparison of such trends with delinquency and default
information for mortgage products serving households with incomes
above the median level that have been purchased by the
corporation, and evaluate the impact of such trends on the
standards and levels of risk of mortgage products serving low-
and moderate-income families;
(J) describe in the aggregate the seller and servicer network
of the corporation, including the volume of mortgages purchased
from minority-owned, women-owned, and community-oriented lenders,
and any efforts to facilitate relationships with such lenders;
(K) describe the activities undertaken by the corporation with
nonprofit and for-profit organizations and with State and local
governments and housing finance agencies, including how the
corporation's activities support the objectives of comprehensive
housing affordability strategies under section 12705 of title 42;
and
(L) include any other information that the Secretary considers
appropriate.
(3)(A) The corporation shall make each report under this
subsection available to the public at the principal and regional
offices of the corporation.
(B) Before making a report under this subsection available to the
public, the corporation may exclude from the report information
that the Secretary has determined is proprietary information under
section 1326 of the Federal Housing Enterprises Financial Safety
and Soundness Act of 1992 [12 U.S.C. 4546].
(o) Affordable Housing Advisory Council
(1) Not later than 4 months after October 28, 1992, the
corporation shall appoint an Affordable Housing Advisory Council to
advise the corporation regarding possible methods for promoting
affordable housing for low- and moderate-income families.
(2) The Affordable Housing Advisory Council shall consist of 15
individuals, who shall include representatives of community-based
and other nonprofit and for-profit organizations and State and
local government agencies actively engaged in the promotion,
development, or financing of housing for low- and moderate-income
families.