Palantir teams up with Fannie Mae in AI push to sniff out mortgage fraud
Fannie Mae, a quasi-governmental financial firm, recently announced a strategic partnership with Palantir Technologies, a defense tech player, to enhance their capabilities in detecting mortgage fraud. The collaboration aims to leverage Palantir’s advanced technology, including elements of artificial intelligence, to proactively identify fraudulent activities within Fannie Mae’s multi-family housing business. According to Fannie Mae CEO Priscilla Almodovar, initial tests have shown that Palantir’s technology can detect fraud in a matter of seconds, a task that would typically take human investigators several months to uncover.
Palantir Technologies has experienced significant growth, with its stock price soaring over 140% since President Donald Trump’s election victory. The company’s involvement in modernizing the U.S. military and driving cost efficiencies in government operations has positioned it as a valuable partner for the current administration. Palantir CEO Alex Karp emphasized that the mortgage fraud detection program will prioritize data protection and privacy for individuals submitting their information.
Fannie Mae and Freddie Mac, government-sponsored enterprises under the conservatorship of the Federal Housing Financing Agency (FHFA) since 2008, are exploring opportunities to collaborate with innovative tech firms to enhance their operations. FHFA director William Pulte indicated that the Palantir program could potentially extend to Freddie Mac in the future, and discussions are underway with Elon Musk’s xAI firm for a potential partnership. The press release did not disclose the financial terms of the agreement between Fannie Mae and Palantir.
The announcement comes amid discussions about potentially transitioning Fannie Mae and Freddie Mac out of conservatorship to operate as independent entities. President Trump expressed his support for bringing these agencies public while maintaining the government’s implicit guarantees to ensure stability in the housing market. The implicit guarantee serves as a reassurance to investors that the government will intervene to prevent Fannie and Freddie from defaulting on their mortgage-backed securities, ultimately contributing to lower mortgage rates.
As plans for the public offering of Fannie Mae and Freddie Mac evolve, stakeholders, including shareholders like Bill Ackman’s Pershing Square, are closely monitoring developments. The potential IPOs of these entities could present lucrative opportunities for investors holding equity shares in the firms. FHFA director William Pulte emphasized that the exact roadmap for taking Fannie and Freddie public remains fluid, with considerations for potential scenarios, including the companies remaining in conservatorship.
