Special News Alert from Register of Deeds John L. O'Brien: O'Brien requests DOR file legal action against "Fannie Mae" and "Freddy Mac"

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Special News Alert from Register of Deeds John L. O’Brien: O’Brien requests DOR file legal action against “Fannie Mae” and “Freddy Mac”

Special News Alert from Register of Deeds John L. O’Brien: O’Brien requests DOR file legal action against “Fannie Mae” and “Freddy Mac”

 

 

 

Special News Alert from Register of Deeds John L. O’Brien

 

Southern Essex District Register John O’Brien requests the Department of Revenue file

  legal action against “Fannie Mae” and “Freddy Mac”

 

Contact: Kevin Harvey 1st Assistant Register

 978-542-1724

 kevin.harvey@sec.state.ma.us

Southern Essex District Register of Deeds John O’Brien today is asking the Massachusetts Department of Revenue to file legal action against mortgage giants Federal National Mortgage Association (“Fannie Mae”) and Federal Home Loan Mortgage Corporation (“Freddy Mac”) for their failure to pay deeds excise tax, on property transfers in Register O’Brien’s District. According to O’Brien his district alone is owed approximately $4.2 Million.  O’Brien was notified late Friday that a United States District Judge in Michigan concluded that Fannie Mae and Freddy Mac were not entitled to an exemption from excise taxes in Michigan.  The Michigan Court cited numerous cases; two of significant interests were a 2011 Nevada case involving Countrywide Home Loans and 1988 United States Supreme Court case involving Wells Fargo Bank. In Nevada, the Court concluded that Fannie Mae was essentially a privately owned mortgage banker and not a federal instrumentality for tax purposes. In the Wells Fargo Case, the United States Supreme Court concluded that a transfer tax is a form of excise tax and are not direct taxes.  The Supreme Court decided that direct taxes were exempt, however transfer taxes were not.

According to O’Brien, since 1991 Fannie Mae and Freddy Mac have been involved in property transfers with total sales values of over $920 Million Dollars in his district.  These transactions would have generated close to $4.2 Million Dollars in tax revenue to the Commonwealth for his district alone had Freddy Mac and Fannie Mae paid the excise tax rather then claiming exemptions. If a private citizen or corporation sells a piece of Massachusetts real estate, they are required to pay a deeds excise tax of $4.56 per thousand dollars of the purchase price, however Fannie Mae and Freddy Mac pay nothing.   Certain tax exemptions are given to governmental entities, however O’Brien points out that Fannie Mae and Freddy Mac although originally created as government entities are now publicly traded companies owned by investors.  O’Brien notes that these private corporate entities that have shareholders and are paying their top executives millions of dollars in salaries and bonuses are wrongfully claiming the excise tax exemptions. “This lost revenue goes a long way in providing key services for the people of Massachusetts.  The message in our Commonwealth to all those that think that they can circumvent the system should be loud and clear; pay like everyone else, or deal with the consequences.”

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One Response to “Special News Alert from Register of Deeds John L. O’Brien: O’Brien requests DOR file legal action against “Fannie Mae” and “Freddy Mac””

  1. RaShell Keller says:

    BofA mess- insert my name into any of these folks whom the bank is trying to take their homes and add that BofA also wants me to settle a case against people who defrauded me during the sale of home to me by plastering over basement and is willing to pay them off while they require me to agree to rediculous terms in order to “continue to consider me for a modification-
    contact me and I will send you the “official sttlement offer”…

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