Justice Breyer characterized the net worth sweep as the nationalization of the GSEs. The government and the court-appointed amicus curiae disagreed, describing it as a simple renegotiation of a contract.

The Fifth Circuit found FHFA’s structure unconstitutional but decided the remedy was to simply toss the structure and leave the net worth sweep standing. The Supreme Court will now grapple with the two issues.

The new rule provides clarity about how much and what kind of capital Fannie and Freddie will need in order to exit conservatorships. But the likelihood of that kind of capital raise seems remote.

As of the end of August, eight individuals had either been indicted or charged in criminal complaints related to PPP fraud.

Aaron Nielson said the high court’s recent decision in Seila v. CFPB actually supports his contention that FHFA’s structure is legitimate.

A federal prosecutor in Georgia has charged 12 individuals in connection with a multiyear scheme to defraud Fannie Mae and Freddie Mac.

Housing-finance watchers are gearing up for December when the Supreme Court will hear oral arguments challenging the government’s net worth sweep of Fannie Mae and Freddie Mac profits.

The Supreme Court is likely to give the president the power to replace the FHFA director for any reason, much like it did in the Seila Law v. CFPB case, according to Cowen analyst Jaret Seiberg.

The high court decision could impact how other independent federal agencies — such as the Federal Housing Finance Agency — operate.

Time is of the essence if FHFA Director Mark Calabria wants Fannie and Freddie irrevocably out of conservatorship before a possible change in administrations in November.