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Richard F, Davet PO Box 10092 Cleveland, OH 44110 Phone 216-451-6211 fdavet( Emai July 18. 2016 Via Email Leonard J. DePasquale Chief Counsel. FHFA-OIG Office of Inspector General Federal Housing Finance Agency 400 7" Street SW Washington, DC 20219 RE: Your voice mail call this past week Dear Mr.DePasquale: ‘Thank you for your phone call. It has come to my attention an exchange of correspondence dated May 17 snd May 31, 2016 between Senators Grassley and Johnson and the FHFA OIG copies of which are attached. In your response letter dated May 31,2016 to the Senator’s staff you allude to “pending matters”. I would like to know if my issues with the FHFA OIG are included in those matters? Please advise. Thank you. Sincerely, {s) Richard Davet Rflec Ce: The Honorable Laura $. Wertheimer Enel : Grassley/Johnson letter 051716 DePasqale letter 053116. United States Senate WASHINGTON, OC 20510 May 17,2016 VIA ELECTRONIC TRANSMISSION ‘The Honorable Laura S, Wertheimer Inspector General Federal Housing Finance Agency 400 Seventh Street, SW ‘Washington, DC 20024 Dear Inspector General Wertheimer: ‘As you know, the Homeland Security and Governmental Affairs Committee and the Judiciary ‘Committee have been inquiring into various issues regarding the Federal Housing Finance Agency Office of Inspector General (FHFA-OIG). In the course of that inquiry, it has come to the Committees” attention that your office is the subject of one or more complaints before the Integrity Committee of the ‘Council of the Inspectors General on Integrity and Efficiency (CIGIE) and the Office of Special Counsel (OSC). Ithas also come to the Committees’ attention that your office has retained one or more private attorneys in some capacity, perhaps in connection with these proceedings or the Committees” inquiry. Government agencies should generally obtain most of the legal services they need from government attomeys—whether from in-house attorneys or attorneys from another agency.' For example, Inspectors General may consult with and obtain advice from other counsel within the Inspector General community without incurring the added expense of private counsel. In certain circumstances, where the proper authority exists, agencies may hire outside counsel. However, given the added expense and the substantial resources already devoted to paying for in-house legal advice, outside counsel should only be engaged when clearly authorized and necessary. In order to better understand the nature and circumstances of legal representation procured for or by FHFA-OIG, please provide responses to the following questions: 1, Has FHFA-OIG retained any private attorney(s)? If so, please provide a copy of all retainer agreements, including the hourly rate of pay. 2. For each attorney hired: a. whom precisely does the attorney represent? for what purpose was each attorney retained? cc. what is the scope of the representation? 4. how much has been paid to each attomey to date? * See, eg, 5 U.S.C. § 3106 (providing that agencies should refer litigation matters to the Department of Justice unless ‘otherwise authorized by law). Page 2 of 3 3. Please describe the legal authority for FHFA-OIG to hire a private attorney for the purposes described in your answer to question number 2. 4. According to FHFA-OIG's 2015 Congressional Budget Justification, the FHFA-OIG Office of Counsel serves as the chief legal advisor to the Inspector General and provides independent legal advice, counsel, and opinions to FHFA-OIG about, among other things, its programs and operations. Why was the FHFA-OIG Office of Counsel deemed insufficient to provide representation in this instance? 5. Prior to hiring outside counsel, did FHFA-OIG explore the possibility of using the expertise found at other agencies of the government on a temporary or short-term basis? 6. Please describe the efforts made to determine whether the proposed employment of outside counsel would be cost-effective, including the analysis performed and the outcome of that, analysis. 7. What procedures were used to ensure that the hiring of any private attorney was competitive and designed in a manner to reduce the prospect or appearance of favoritism and result in a higher quality legal service and savings in cost? 8. What efforts were made to identify conflicts or potential conflicts and how are those conflicts being managed? 9, The Administrative Conference of the United States has recommended that any agency that anticipates a need to hire private attorneys should prepare written public guidelines concerning ‘when and how it will seek outside counsel and that agencies should prepare an annual report listing basic information relating to legal service contracts awarded.’ Has FHFA-OIG completed these actions? If so, please provide a copy and indicate where they have been made public. If not, please explain why not, Please provide your responses to these questions no later than May 31, 2016, Should you have any questions, please contact Paul Junge of Chairman Grassley’s staff at (202) 224-5225 or Michael Lueptow of Chairman Johnson’s staff at (202) 224-4751. Thank you for your cooperation in this important matter. Sincerely, Chak Charles E. Grassley Chairman ‘Committee on the Judiciary 2 Agency Hiring of Private Attomeys, 52 Fed. Reg. 23,632 (June 24, 1987). ‘The Honorable Patrick J. Leahy Ranking Member Committee on the Judiciary The Honorable Thomas R. Carper Ranking Member Committee on Homeland Security and Governmental Affairs Carolyn N. Leer Special Counsel United States Office of Special Counsel 1730 M Street, NW ‘Washington, DC 20036 ‘The Honorable Michael E. Horowitz Chair of Council of the Inspectors General on Integrity and Efficiency (CIGIE) 1717 H Street, NW, Suite 825 Washington, D.C. 20006 Page 3 of 3 OFFICE OF INSPECTOR GENERAL Federal Housing Finance Agency 400 7th Street SW, Washington, DC 20219 May 31, 2016 David Brewer, Chief Investigative Counsel Jason Foster, Chief Investigative Counsel Michael J. Lueptow, Investigative Counsel Paul Junge, Investigative Counsel Committee on Homeland Security ‘Committee on the Judiciary and Governmental Affairs United States Senate United States Senate Washington, DC 20510 Washington, DC 20510 Via Electronic Mail Subject: Response to Request for Information dated May 17, 2016 Gentlemen: ‘Thank you for your inquiry regarding the Federal Housing Finance Agency (FHFA) Office of Inspector General (FHFA-OIG) retention of outside counsel. FHFA-OIG has retained outside counsels to assist with pending matters related to and arising out of an administrative personnel action and Congressional inquiries.’ Attorney Peter Broida, Esq. of Arlington, VA, and Zuckerman Spaeder LLP of Washington, DC have been retained to represent FHFA-OIG in regard to one or more issues related to the above referenced matters.” Kindly note that additional responses and information sought in your requests comprise pre- decisional and deliberative information, as well as attomey-client communications, all of which are privileged and involve pending matters. Accordingly, that information is not included in this production. As with the prior requests for privileged information, we remain prepared to discuss ‘with Committee staff possible approaches that may result in a mutually satisfactory resolution. "HFA, like other prudential regulators, isan independent agency of the federal government, with independent tion authority. See 12 US.C. $§ 4511, 4513(c), and 4517(d). See also Humphrey's Ex'r v. United Sates, 29S, USS, 602, 629 (1935); FDIC v. Irwin, 727 F. Supp. 1073 (N.D. Tex. 1989), aff'd. 916 F.2d 1051 (Sth Cit, 1990); Compiroller of Currency v. Lance, 632 F. Supp. 437 (N.D. Ga. 1986). FHA is funded through assessments from the entities it regulates, which are not Government or public funds. 12 U.S.C. §§ 4516(a), (D. 2 Mr. Broida’s hourly fee is $400; Zuckerman Spaeder’s hourly fees range from $775 to $850. Non-Public Letter to Messrs. Brewer, Lueptow, Foster, and Junge May 31, 2016 Page 2 ‘Thank you for your interest in FHFA-OIG. Please call me at (202) 730-2830 with any questions. Respectfully, Fa Ke Chief Counsel, FHFA-OIG