Mortgage Investigation Initiated Through Agency Referral
Government emails obtained by Reuters reveal that a mortgage fraud investigation targeting Democratic Congressman Eric Swalwell commenced last month. The probe was initiated after William Pulte, the Republican head of the Federal Housing Finance Agency, forwarded allegations from a conservative news website to his agency's inspector general for potential criminal investigation.
Allegations About Residence Documentation
On November 12, The Gateway Pundit published an article claiming that Representative Eric Swalwell had inaccurately designated his Washington, D.C., property as his "principal residence" on mortgage documents. Swalwell, who represents a Northern California district and is currently campaigning for California governor—a position requiring state residency—has maintained that he is a permanent resident of California. However, loan paperwork reportedly listed his Washington home as his primary residence.
An email reviewed by Reuters indicates that Pulte sent the article link to the FHFA's acting inspector general on that same day, urging appropriate action "including - if warranted - engagement with the Department of Justice regarding potential mortgage, tax or other fraud related to the representations made in mortgage documents or other items in the below article."
A source familiar with the situation, speaking anonymously due to lack of authorization to discuss the matter publicly, confirmed that Pulte also referred the issue to the Justice Department on November 12.
Ethical Concerns and Broader Pattern
Ethics experts have raised concerns about Pulte's approach to pursuing individuals for mortgage documentation issues, noting such prosecutions have historically been uncommon. Richard Painter, who served as chief White House ethics lawyer under former Republican President George W. Bush, commented: "This has been part of the broader pattern of the politicization of the Department of Justice. It's highly unethical to try to go after political enemies like this." He added, "It's an abuse of public office and an abuse of public trust."
The allegation against Swalwell follows similar accusations Pulte has made against other prominent Democrats and public officials, including New York Attorney General Letitia James, California Senator Adam Schiff, and Federal Reserve Board Governor Lisa Cook. These individuals have all faced criticism from former President Donald Trump in his campaign against perceived opponents.
Investigative Process and Legal Response
A congressional oversight body announced this month that it will examine whether Pulte misused his authority by bypassing the FHFA's standard investigative procedures in what critics describe as politically motivated actions. Typically, the FHFA office of inspector general handles mortgage fraud investigations and refers cases to criminal prosecutors when necessary, but Reuters previously reported that Pulte has circumvented this office in making such referrals.
In late November, Swalwell responded legally by filing a lawsuit against Pulte and the agency. He alleges violations of his privacy through the retrieval of his mortgage records and retaliation for exercising his First Amendment rights. In the lawsuit, Swalwell states that he is a permanent resident of California and "disclaimed any intent to occupy the District of Columbia home as his primary residence in a sworn affidavit attached to his mortgage agreement."
Swalwell told Reuters in a statement: "Trump and his team's allegations against me are nonsense. Pulte's newly revealed conduct only reinforces why I brought this case. I intend to see it through."
The communications between Pulte and the FHFA inspector general were obtained by Democracy Forward, a legal organization with prominent Democrats on its board, and reviewed by Reuters.
Regarding other cases, a federal judge has dismissed a fraud case against New York Attorney General Letitia James that originated from Pulte's referral, and two subsequent grand juries have declined to indict her again. James and other targets of Pulte's mortgage fraud campaign have denied any wrongdoing.
The FHFA and Pulte did not respond to requests for comment. Pulte has previously defended his actions, stating that mortgage fraud undermines the U.S. housing market.
The Gateway Pundit contributor who authored the original article expressed satisfaction with increased attention to the issue. A Justice Department spokesperson declined to comment.
Financial institutions typically offer lower interest rates for principal residences compared to vacation homes or investment properties, providing potential savings on mortgage payments.
