WASHINGTON (AP) — A federal judge has ruled against investors who are trying to collect billions of dollars in profits of government-chartered mortgage companies Fannie Mae and Freddie Mac.
The decision by U.S. District Judge Royce Lamberth was a victory for the government. Amid the recent mortgage crisis, the government pumped $187 billion into the troubled companies, which have since recovered and now have quarterly profits running into the billions.
Recovering money for itself, the government is collecting a dividend amounting to nearly every dollar of the companies’ net worth. That leaves nothing for private investors who had put money into the companies when they faced collapse.