Bill Pulte, President Trump’s director of the Federal Housing Finance Agency, moved this week to slash the inspector general’s office that scrutinizes his actions, prompting calls from congressional Democrats for his resignation.
It was the second time that Trump administration officials have taken steps to limit scrutiny of the federal regulatory agency run by Mr. Pulte, who has become one of the administration’s most contentious figures because he prides himself on carrying out investigations into Mr. Trump’s rivals.
In November, the Trump administration removed Joe Allen, the F.H.F.A.’s acting inspector general, after congressional Democrats asked Mr. Allen to investigate Mr. Pulte’s “troubling and unprecedented politicization of the agency’s investigative functions” by targeting. the president’s perceived enemies.
The inspector general’s office has remained without a permanent leader. Now, Mr. Pulte has announced plans to make even more significant cuts, with reductions so severe that agency staff told Congress they would cause the inspector general’s office to “wind down its operations,” according to Democrats on the House Financial Services Committee.
In response, Democratic leaders in Congress called on Mr. Pulte to resign.
Senator Elizabeth Warren, Democrat of Massachusetts, took aim at Mr. Pulte’s cuts in a hearing Thursday, accusing him of “unlawfully shutting down the work of the inspector general responsible for investigating misconduct at the Federal Housing Finance Agency and in multitrillion dollar mortgage markets.”
Ms. Warren read aloud from a letter that staff from the agency’s inspector general’s office sent to Congress.
“We will be forced to reduce staffing by approximately 70-80% in FY 2027, which will result in the discontinuance of essentially all criminal investigations conducted by our Office of Investigations,” the letter stated.
“These cuts will mean more fraud in the mortgage market, more cheating of families, higher costs for people trying to buy a home,” Ms. Warren said. “And why? Why? So Bill Pulte can dismantle a watchdog that would hold him accountable for his misconduct weaponizing the F.H.F.A. to persecute President Trump’s perceived political enemies.”
Inspectors general, by law, are tasked with preventing and detecting fraud, waste and abuse related to their agencies, while promoting efficiency in agency programs and operations. While they exist within respective federal agencies, they are designed to act independently and in a nonpartisan manner.
In a statement, Mr. Pulte’s agency said he was merely trying to “right size” the inspector general’s office, which he argued had grown too large when compared to other agencies. He said other inspectors general use just 2 percent of their agency’s operating budget, while the F.H.F.A.’s inspector general uses 16 percent.
“F.H.F.A. is not cutting oversight,” the agency said in an email seeking comment.
Mr. Pulte attacked Ms. Warren on social media with the nickname “Pocahontas,” the insult the president uses for the senator.
“Elizabeth ‘Pocahontas’ Warren is introducing a bill tonight to kill this good financial stewardship to align our IG’s office with its Peer IG Offices,” Mr. Pulte wrote. “It’s very sad that Pocahontas wants to waste precious federal money like a drunken sailor.”
Mr. Pulte has targeted Senator Adam Schiff, Democrat of California who led an impeachment effort against Mr. Trump, and New York Attorney General Letitia James, who pursued a civil fraud judgment against Mr. Trump and his family business, among others.
Staff in inspectors general offices across the federal government have been operating in a state of fear since Mr. Trump fired or demoted at least 20 inspectors general in his second term, and instituted staff reductions of up to 30 percent in some office. Since the mass firings, the president has appointed some government watchdogs with overtly political backgrounds. And they have directed their investigations toward allegations of fraud at the state level, instead of targeting the agencies that they are meant to scrutinize.
Mark Greenblatt, who was the inspector general for the Interior Department before Mr. Trump fired him last year, said Mr. Pulte is comparing apples to oranges in his criticism of the F.H.F.A. inspector general office’s size. Unlike some other offices, it has a broad mandate to investigate mortgage fraud across the country.
“In my 20 years in the oversight community, it is unheard of for an agency head to cut an OIG’s budget and effectively try to starve them out of existence,” he said. “This should raise red flags for every American taxpayer.”
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