Skip to main content

Truth Squad: Did Gingrich, Romney invest in Fannie, Freddie?

By the CNN Wire Staff
updated 3:03 AM EST, Fri January 27, 2012

Editor's note: Part of the CNN political fact-checking series

(CNN) -- Former Massachusetts Gov. Mitt Romney and former House Speaker Newt Gingrich both accused each other of having financial interests in Fannie Mae and Freddie Mac during the Republican debate Thursday night.

The statements: "We discovered, to our shock, Governor Romney owns shares of both Fannie Mae and Freddie Mac. Governor Romney made $1 million off of selling some of that. Governor Romney has an investment in Goldman Sachs, which is, today, foreclosing on Floridians." -- Former House Speaker Newt Gingrich

"First of all, my investments are not made by me. My investments, for the last 10 years, have been in a blind trust, managed by a trustee. Secondly, the investments that they have made, we learned about this as we made our financial disclosure, have been in mutual funds and bonds. I don't own stock in either Fannie Mae or Freddie Mac. There are bonds that the investor has held through mutual funds. And, Mr. Speaker, I know that sounds like an enormous revelation, but have you checked your own investments? You also have investments through mutual funds that also invest in Fannie Mae and Freddie Mac." -- Former Gov. Mitt Romney

The facts:

Romney's blind trust holds Fannie Mae and Freddie Mac, the government-backed housing lenders, according to his public financial disclosure report filed last August with the Federal Election Commission. The financial holdings that are held in a blind trust are overseen by a trustee and are not known to Romney. The same report cites holdings that are not in his blind trust -- including a mutual fund that contains Fannie Mae and Freddie Mac. The report does not say how much money he has in them. It says only that the mutual fund holding represented between $250,001 and $500,000, which makes up a small portion of Romney's holdings. It was not clear where Gingrich got his claim that Romney had made $1 million by "selling some of that."

According to Gingrich's disclosure report, he had holdings in four mutual funds that included Fannie Mae and other financial institutions that were part of the 2008 financial meltdown.

Specifically, he had $500,001 to $1,000,000 in Alliance Bernstein 2010 Retirement Strategy Fund, which includes Fannie Mae, Freddie Mac, Citigroup, and Goldman Sachs; $15,001 - $50,000 holdings in Franklin-Templeton's Franklin Income Fund, which includes Fannie Mae, Freddie Mac; $15,001 - $50,000 holdings in Pimco's Total Returns Fund, which includes Goldman Sachs and JP Morgan Chase; 50,001 - $100,000 in Alliance Bernstein 2030 Retirement Strategy Fund, which includes Fannie Mae, Freddie Mac, and Goldman Sachs.

The verdict, part one (did Romney and Gingrich invest in Freddie Mac and Fannie Mae?): True. Both men have holdings in the companies, though the reports do not specify the degree of their involvement. Also, Freddie Mac told CNN on Wednesday that Gingrich was a consultant for the government-sponsored enterprise.

The verdict, part two (were all of Romney's Freddie Mac and Fannie Mae investments in a blind trust?): False. Some of Romney's investments in Fannie Mae and Freddie Mac were outside of his trust, which means he could have known about them.

CNN's Amy Roberts and Tom Watkins contributed to this report

ADVERTISEMENT
ADVERTISEMENT