In oversight preview, Dems demand FHFA's Pulte testify

• Key insight: Senate Banking Committee Democrats demand that the panel Chairman Tim Scott, R-S.C., call on Pulte to testify before the committee. 
• Forward look: Being in the minority, Democrats cannot compel Pulte to testify on their own. But if either chamber changes hands after this November's elections, Democrats will have subpoena powers and can compel testimony. 
• What's at stake: The letter previews a theme of oversight for the Federal Housing Finance Agency's next Congress. 

WASHINGTON — A group of Senate Democrats on the banking panel are calling on Senate Banking Committee Chair Tim Scott, R-S.C., to compel Federal Housing Finance Agency Director Bill Pulte to testify, hinting at priorities for a Democrat-held panel next Congress. 

Sens. Jack Reed of Rhode Island and Catherine Cortez Masto of Nevada led all of their Democratic colleagues on the Senate Banking Committee, demanding that Pulte appear before the committee. 

Democrats do not have the power to compel testimony on their own, as that power rests with the committee chair, but the letter is a strong indicator of where Democrats intend to start should they win control of the Senate in this year's midterm elections. 

Analysts expect that Pulte, who led the FHFA's effort to investigate President Donald Trump's political enemies, including Federal Reserve Gov. Lisa Cook, New York Attorney General Letitia James and Sen. Adam Schiff, D-Calif., will be a prime target.

Democrats at the moment appear poised to retake a significant number of seats in the 2026 midterm elections in November. Should they do so and get the gavel in the House Financial Services Committee and the Senate Banking Committee, oversight of the Trump administration will take top priority. 

Last week, the FHFA said it will slash funding to the agency's Office of Inspector General, a watchdog that investigates Pulte's actions and the agency. The FHFA will give the OIG $20 million in fiscal 2027, a 61% drop from the previous year. 

"Simply stated, funding at the $20 million level will eliminate our capacity to effectively conduct criminal investigation of mortgage, bank, and other fraud schemes involving the entities FHFA regulates," James Hodge, acting inspector general at the FHFA OIG, told lawmakers in a letter. The drop in funding will mean cutting staff by 70% to 80%, he said. 

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Last year, Pulte removed the previous inspector general, Joe Allen, after congressional Democrats asked Allen to investigate Pulte's weaponization of the agency. 

In the newest letter, the Senate Democrats asked Chair Scott to call on Pulte to testify. 

"Hearing testimony from Director Pulte is more important than ever in light of his recent decision to shutter the FHFA Office of Inspector General," the lawmakers said. 

With the gavel, Democrats could subpoena Pulte and compel him to testify. The lawmakers in the letter also criticized Pulte's appointing himself chair of Fannie Mae and Freddie Mac, shrinking the agency size by laying off workers and serving as the acting director of national intelligence.