James Lockhart, Skull & Bones classmate bunked with GW & and now Fannie Mae?
APRIL 27, 2006
Investing
By Dawn Kopecki, Business Week
The Man for Fannie and Freddie?
Former head of PBGC, Skull & Bones frat brother of GW Bush, and former CEO of Gulf Oil Will Ensure that Fannie Mae is Honest!
Senior Social Security Administration official and close Bush
Buddy James B. Lockhart is the hot tip to oversee the mortgage giants
The White House is expected to move Social Security
Administration official James B. Lockhart III into the top job
overseeing Fannie Mae and Freddie Mac as early as Apr. 27, according to people
familiar with the matter.
A White House spokeswoman said the
Administration hadn't issued any personnel announcements by late Wednesday,
declining further comment. However, SSA Deputy Commissioner Lockhart, a
long-time personal friend of President George W. Bush, has been rumored
as the top candidate for the job since late January. Fannie Mae and Freddie Mac
are giant mortgage finance companies chartered by the federal government, with
the goal of making home loans more affordable.
TENSE
TIMES. The Bush Administration is expected to use an unusual rule
to place Lockhart, who is currently the No. 2 at SSA and has already been
confirmed by the Senate for that job, immediately in the job as director of the
Office of Federal Housing Enterprise Oversight (OFHEO).
Lockhart, who could not be reached for comment late Wednesday, will
replace acting Director Stephen Blumenthal.
The development
comes just weeks before the agency is expected to release its long-awaited
report on accounting shenanigans at Fannie Mae. The agency has recognized $12 billion in accounting errors
and says that it expects to find more. A law firm hired by
Fannie's board said in an internal report that the organization's executives had
violated accounting practices for years.
Lockhart has extensive
experience as a financial regulator and on Wall Street. At SSA, he serves as the
agency's chief operating officer, secretary on the Social Security Board of
Trustees, and as a member of the President's Management Council.
BANKING BACKGROUND. Under the previous Bush
Administration, Lockhart served as executive director of the Pension Benefit Guaranty Corporation PBGC from 1989 until 1993
and as director of the Association of Private Pensions & Welfare Plans,
which is now the American Benefits Council, from 1993 until 1995.
He
joined SSA in 2002 from NetRisk, a risk-management software and
consulting firm he co-founded that serves major financial institutions,
including banks, insurance companies and investment management firms worldwide.
Prior to that, he worked as a top finance executive for National Re and as a
managing director for Smith Barney.
On a personal level,
Lockhart attended the same prep school as Bush. They shared the same dormitory
at Phillips Academy Andover in Massachusetts, where Lockhart has told reporters
the two met days after enrolling. Lockhart and Bush were also Skull and Bones fraternity
brothers at Yale before each attended Harvard Business School. Lockhart
graduated with a master's degree in business administration from Harvard in
1974, a year ahead of Bush.
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