Fannie Mae, the victory of Freddie Mac could be the subject of an appeal to the Supreme Court: Mnuchin

The government is questioning the legitimacy of an appeal to the Supreme Court for mortgage giants Fannie Mae and Freddie Mac, said Tuesday at CNBC Treasury Secretary Steven Mnuchin.

"We are looking at it carefully and thinking about the way forward," Mnuchin said of last week's decision by a federal court of appeal, which overturned an earlier ruling that favored the prosecution. the government's collection of the two companies. profits.

The panel of federal judges in New Orleans ruled that mortgage lenders could sue to assert that the sweeping of profits by the Treasury was illegal, reported several media. The judges also found that the structure of the Federal Housing Finance Agency, which regulates Fannie and Freddie, is unconstitutional, according to reports.

"We will consider appealing this decision to the Supreme Court," said Mnuchin, who spoke to CNBC before his testimony before the Senate Banking Committee on housing finance reform. Housing and Urban Development Secretary Ben Carson and FHFA Director Mark Calabria joined Mnuchin.

"There are two parts in. One is obviously the cash flow sweep, and that's what the Treasury is looking at," said Mnuchin.

The Treasury Department did not immediately respond to CNBC's request regarding Mnuchin's remarks.

In 2008, when the real estate market collapsed, Fannie Mae and Freddie Mac were placed under a federal government and received billions of dollars in bailout funds. After returning to profitability, companies were forced to repay billions of dollars to the Treasury.

The New York Times reported in 2017 that companies had received more than $ 187 billion from US taxpayers, but that these companies had repaid nearly $ 271 billion to the government since then.

The new Treasury plan to bring Fannie and Freddie under private control landed on Friday. The plan describes a litany of recommended steps for corporate redesign but has been criticized as vague or incomplete by investors and analysts.

Preferred shares of companies fell after the unveiling of this plan.