Bill Would Set New Secondary MarketRegulator

WASHINGTON - (01/27/05) -- A group of influential senatorsintroduced legislation Wednesday that would set a new regulatoryscheme for Fannie Mae and Freddie Mac, as well as the Federal HomeLoan Bank System. The bill would create a new regulator for thethree dominant players in the huge secondary market for homemortgages, allow that regulator to set new capital standards, andprovide for a government receivership in case of failure of one ofthe entities. The receivership issue was a major bone of contentionduring last year's debate but has regained momentum since theemerging accounting scandal at Fannie Mae. The bill, sponsored byRepublican senators Chuck Hagel of Nebraska, John Sununu of NewHampshire and Elizabeth Dole of North Carolina, is expected to bethe first of several Fannie and Freddie reform bills debated thisCongress.