Over 65 of the 100 ex-employees recently fired from Fannie Mae are seeking reinstatement, back pay and other financial relief in a lawsuit against the government-sponsored enterprise.
In April, the organization had dismissed a slew of employees due to alleged unethical conduct. Per the lawsuit, the removed employees received an email from Fannie Mae Human Resources, directing them not to come into the office, but to instead attend a Microsoft Teams call at 10 a.m. on April 3, 2025. During the call, they were all told that they were being terminated for fraud.
The fraud was described as a misuse of Fannie Mae’s matching gifts program, in which the company matches employees’ donations (up to $5,000) to eligible causes and organizations. According to Fannie Mae, the employees colluded with Telugu Association of North America (TANA) and other similar organizations to misuse the funds for personal gain.
William J. Pulte, director of the Federal Housing Finance Agency (FHFA), and also chairman of the board of directors of Fannie Mae and Freddie Mac, issued a statement following their firing, stating “there is no room for fraud or any other deceitful act that can jeopardize the safety and soundness of the housing industry.”
In response to their firing, plaintiffs filed complaints with the Equal Employment Opportunity Commission and received right-to-sue letters.
The lawsuit was filed on Monday, July 21 in the U.S. District Court and pushes back against the accusations, stating Fannie Mae is using them as a cover for discriminatory mass firings of older Indian national U.S. citizens, mainly employees over the age of 40 who speak Telugu.
Many of the employees had worked with Fannie Mae for more than a decade, and they worked across several departments.
The lawsuit claims all charities involved in the company-match program simply supported Indian national, ethnic and cultural programs and were approved, and that Fannie Mae has not yet provided any evidence to support its claims of fraud.
“In response to a request for reconsideration subsequently made by Plaintiffs, Fannie Mae said that Plaintiffs had made gifts that they knew or should have known violated their policy,” states the complaint. “No explanation of individual conduct was ever given to any Plaintiff.”
As such, the ex-employees say Fannie Mae violated federal anti-discrimination laws—specifically the Title VII of the Civil Rights Act of 1964 and the Age Discrimination in Employment Act of 1967—as well as breach of employment contract for denying severance and other accrued benefits.
Due to this, the plaintiffs, represented by Milton C. Johns of Executive Law Partners, PLLC, allege they are due reparations, including reinstatement and back pay; severance, vacation payout and benefits; compensation for emotional distress; punitive or liquidated damages; and attorney’s fees and costs—with a requested solution brought forth by jury trial.
RISMedia contacted the Federal Housing Finance Agency (FHFA) for comment but has not received a response as of press time.
