In September 2008, the Federal Housing Finance Agency (“FHFA”) placed the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation (“Enterprises”), into conservatorships due to their mounting losses. Since then, the US Treasury has invested over $153 billion in the Enterprises to stabilize them. In 2009 and 2010, FHFA approved executive compensation packages totaling more than $35 million in annual base salaries and deferred performance pay for the Enterprises’ top six officers. Given the concerns about executive compensation levels at companies that have received federal financial support, the FHFA Office of Inspector General (“FHFA-OIG”) initiated this evaluation to assess: (i) the processes used to develop the Enterprises’ compensation packages; (ii) FHFA’s ongoing oversight efforts; and (iii) the transparency of the Enterprises’ executive compensation policies and practices. The review recommends that  FHFA should establish an ongoing review and analysis process to include such issues as the level of federal support for the Enterprises, and the compensation levels for the heads of housing-related federal entities. Additionally, FHFA should establish written criteria and procedures for reviewing performance data, and conduct independent verification and testing of the basis for executive compensation levels.