Why US firm Fannie Mae fired 200 Indian-American staffers
What's the story
In a major internal restructuring, Fannie Mae, one of the top US federal mortgage companies, has laid off 700 employees.
Among those sacked were nearly 200 Indian-American workers, mostly of Telugu origin. They were fired due to ethical concerns related to the misuse of the matching grants program.
The layoffs took place earlier this month.
Misconduct
Allegations of misuse in donation matching program
According to The Times of India, many employees were fired for allegedly abusing Fannie Mae's "matching grants program."
The program is designed to support charitable giving through salary extensions.
The employees allegedly worked with non-profits, including the Telugu Association of North America (TANA), to fake donations and steal corporate matching funds.
Some of the people involved were senior members of these associations.
Scrutiny
TANA under investigation in connection with Fannie Mae layoffs
At the center of this controversy is TANA, a non-profit organization.
In December 2023, a subpoena was issued to TANA by the Northern District of California court demanding financial documents and testimony before a grand jury.
The subpoena sought records of donations received, expenditures made, and details about office-bearers from 2019 to 2024.
Multiple US agencies including the FBI, IRS and DOJ are reportedly investigating TANA.
Congressional reaction
Political response to layoffs
The terminations have also drawn political reactions with Indian-American Congressman from Virginia, Suhas Subramanyam, demanding an explanation from Fannie Mae over the dismissals.
"It has been brought to my attention that Fannie Mae has accused hundreds of my constituents in the Indian-American community of fraudulent behavior and fired them without conducting a full investigation or providing evidence," Subramanyam said.
He added that these employees deserve due process and urged Fannie Mae to provide an immediate explanation.