Millions of people from San Francisco to Shanghai believed in Freddie Mac, its mission and business model and invested hard earned money in the company, not knowing that someone like Richard Syron, that incompetent, arrogant, mediocre and callous executive of Freddie Mac was running the company to ruins and I am sure most if not all hold him responsible for the loss if not the legal theft of their stock. He simply robbed them of their life time savings including this family.

It may be true that Richard Syron is a graduate of Boston College with advanced degrees from Tuft University, however these academic credential does not make one a brilliant manager. We only need to take a look at George W. Bush to see that a graduations from Yale and Harvard does not make one a brilliant manager nor a brilliant leader.

Of course the resume of Richard Syron is impressive by all measures, assistant to Paul Volcker, Chairman of the Federal Reserve Board, senior position with the Federal Reserve Bank of Boston, CEO of the American Stock Exchange. There are many mediocre chief executives who out there and they are there because of powerful network and who are they as a matter of luck. America is full of mediocre executives with high credentials who took their companies and millions of shareholders to ruin.

When Richard Syron was hired to run Freddie Mac in December 2003, the company stock was at $ 65 share and the company was making billions of profits out of solid loans. However Syron, like so many greedy callous executives of the mortgage industry of the time, was out to make millions for himself while taking the company, its employees and shareholders and the nation on a ruinous adventure making him responsible for the loss whipping out $80 Billions of company value. How can an executive make $20 millions annually and manage to ruin the company he runs. It can happen only in America.

 
The New York Times reports that in mid 2004, David Andrukonis, then Freddie Mac Chief Risk Officer warned Syron of the increasing risk in Freddie Mac’s portfolio of high risk loans developed, marketed and sold by greedy, unscrupulous Wall Streets financial experts, bankers, owners and chief executives of mortgage executives, who made tens of billions pushing high risk loans to unqualified and greedy home buyers who bought the sales pitch of these mortgage salesmen when both the buyers and sellers knew there is no way to service these mortgages. They were all part of a house of cards. Syron who was paid $ 38 millions since December 2003 should have known better (he was not paid the minimum hourly wage) than to get Freddie Mac into this game of crooks and scoundrels, yet he simply ignored the advice and took Freddie Mac, its employees and shareholders and the nations to ruins. Richard Syron knew the consequences of his stupid reckless decisions yet he ignored all of this thinking only of his fat compensation package and severance package.

 
In the greater Washington area, Freddie Mac is known to have some of the best talents out there and its employees have a great sense of pride working for a company, they believed in, that has a great social mission of providing available mortgages to millions of Americans. However it seems that dedications, talents, honesty and smart did not extend to the executive suite of Richard Syron. Too bad for the thousands of talented, dedicated and competent people that are Freddie Mac.

Do not understand how a highly compensated board of directors do not ask hard questions of management and do not do their job in protecting the company they are entrusted to do? What was the board of director doing while Richard Syron was taking Freddie Mac down the drain? The board of directors after all, are the trustees, with its full meaning of trust and responsibility that comes with it. One has to wonder where was Mr. James B. Lockhart, III, the managing director of the Office of Federal Housing Enterprise Oversight from all of this. He too should be held responsible for what happened to both Fannie Mae and Freddie Mac.  A public trial should be held for all those responsible for the ruins of Fannie Mae and Freddie Mac.

Failures of such magnitude doe not come by over night and do not come by accident; they are the result of deliberate decisions taken by highly paid reckless and incompetent executives. Well it clear that these executives not only screwed up the company and its employees, they screwed tens of thousands of shareholders and screwed up the nation and tax payers. Instead of getting fat ass compensation package they should be facing a class action law suites and public trial that see them lose every thing they ever had in partial compensations for ruining the lives of so many people. I am sure Richard Syron will go on to lead another public company and take it to ruin again, while getting paid tens of millions of dollars. It seems this is the standard practice in America these days. Perhaps top business schools in the US should start teaching course on “how to take a healthy company to ruin while earning tens of millions in compensations”. The story of Richard Syron and James Lockhart should not end with a healthy severance package and a thank you note from a grateful nation.

The material gathered in this posting came from Googling Richard Syron and Freddie Mac. More to come on the highly paid, greedy incompetent American executives who took and are taking down their companies and the stockholders down the drain. I am sure some of these executives will go on to Harvard, Stanford, Chicago and Michigan to teach your graduate students how they mange to ruin their companies while making millions doing it.

 Special Note: This posting was drafted a day after Syron was fired, but its publishing was delayed to avoid any adverse impact and retributions on family members employed by or associated with Freddie Mac. However Syron arrogant testimony before Congress this week and his refusal to admit not only he was wrong but to apologies for ruining the financial lives of millions of people around the world. The man should be put in jail for life.

Sami Jamil Jadallah

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