Fannie Mae Lays Off 700 Employees Over Charity Fraud Allegations; Telugu Groups Under Investigation:

Indian-American employees, chiefly of Telugu descent, who were accused of misusing the charitable donation matching program offered by Fannie Mae, have now lost their jobs as the firm has discharged approximately 700 workers. This is the result of an internal restructuring move by the federally established lender which appears to be motivated by ethical considerations.

The layoffs took place between April 9 and April 10, 2024 as an internal investigation into suspected financial misconduct began probing suspicious activities. Those employees in question are believed to have colluded with specific non-profit entities to provide false claimsof making donations to receive corporate sponsored funds. The Telugu Association of North America is alleged to be one of the nonprofits that were part of the scheme.

Nonprofit Relations and Federal Scrutiny

Some of the cancelled contracts incorporated people who played leading roles in various organizations within the Telugu community. One was identified as a regional vice president of TANA while another is related to an ex-president of the American Telugu Association (ATA). Such connections have attracted the attention of federal investigators.

TANA is in particular the subject of multiple federal agency investigations with the FBI, IRS and DOJ. A subpoena was issued by the Northern District of California Ex parte on C50155-2022 order该 in December, 2023 demanding TANA to surrender documents detailing their donations and expenditures in addition to an outline on their office-bearers from 2019 to 2024.

Reports indicate that other Telugu associations might also be facing scrutiny, but TANA, however, seems to be at the epicenter of the fiasco.

On the Response of the Community

This incident is analogous to the case of Apple inc. when the company fired more than 100 employees for abusing the company’s charitable matching gifts policy. The incident with Fannie Mae, though, has raised much wider community as well as political attention.

U.S. Congressman from Indian origin Suhas Subramanyam has publicly challenged the approach that Fannie Mae has taken concerning the issue. Subramanyam pointed out the shocking lack of due process, asserting that a significant number of the employees were laid off without proper justification and no chance to contest the presented charges.

What Comes Next

With the investigations still unfolding, several U.S-based Telugu associations will likely receive heightened attention from regulators. At the same time, other employees and advocacy groups are demanding answers alongside the advocacy groups of employees whom they regard as affected and unjustly treated by Fannie Mae.