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December 28, 2004
Tuesday, December 28, 2004 8:10:36 AM
Out of Sight, But Not Out of Pocket
Fannie Mae (NYSE: FNM) shareholders have been screwed over to the tune of about $30 million in value of the payments to be paid to fired CEO Frank Raines. This is an outrage. Frank Raines did not build this company. He had the privilege and good fortune of leading its management team for a time. He was an employee, for which he was suitably compensated. On his watch, Fannie Mae self-destructed. If the man had an ounce of self-respect, he would have politely resigned as he told a Congressional committee he would do if his agency were found to have misled its stakeholders. If the Fannie Mae Board had an ounce of self-respect, it would have terminated the senior management team, or resigned themselves. After the disgraceful performance of his management team, Frank Raines walked out the front door, head held high, with a thank-you package that included a lifetime royalty of $1.37 million per year, lifetime health and medical benefits and millions in deferred cash compensation plus millions more in stock options. I'd guess that the hard-working Fannie Mae staff of tens of thousands does not include very many who will receive even a single million for doing their job professionally for the rest of their careers for this organization. They must be sick to their stomachs this morning to see Mr. Raines join the Dick Grasso Hall of Fame. And when they return to their jobs in the new year, I'll just bet they are ready to bust their butt even more for the next CEO.
Posted by Posted by Bill Cara on December 28, 2004 08:10:38 AM | Category: Cara Today in the Market