It’s hard to picture Dick Syron as the bad guy.
That is certainly the role cast for him as the lead defendant in the Securities and Exchange Commission lawsuit alleging that Syron and other top executives of Freddie Mac misled investors about the scale of dangerous loan guarantees building up at the mortgage giant.
The allegations in that suit and a companion complaint against the executives who led the nation’s other mortgage giant, Fannie Mae, are not about splitting hairs. The SEC alleges Freddie Mac told investors its exposure to risky mortgages ranged from $2 billion to $6 billion, but that the danger was actually much higher -- $141 billion by the end of 2006, and still higher from there. Everyone knows how badly that ended.
The SEC tells a dark story that is difficult to reconcile with Syron’s reputation from a career built in Boston and elsewhere. The conflict is all about character.
Syron was a particular kind of Boston business success story for most of his working life. He came from a very modest family background, the son of Irish immigrants growing up in Watertown. He studied economics at Tufts and got his first real break working as an assistant to then Federal Reserve chairman Paul Volcker, a mentor who became famous for resisting political heat in Washington.
Syron returned home to run the Federal Home Loan Bank of Boston and later ran the Federal Reserve Bank of Boston, where he was best known as an honest broker on the hot-button political issue of home loan discrimination.
Syron was an appealing personality because he worked in a sophisticated financial world but knew how to connect with the man on the street. He thrived professionally in a kind of ivory tower but seemed to know how real people lived.
Most interestingly, he never seemed too impressed by all the money that surrounded him every working day. People, including me, credited him with a kind of integrity for that.
Later, Syron went on to run the American Stock Exchange and then Thermo Electron Corp., the Waltham company known today as Thermo Fisher Scientific.
I went to New York in 1995 to visit Syron and write a story about him in his role as the head of the American Stock Exchange. A photo of Volcker was prominently displayed in his office. Syron was making a lot more money by then, but he seemed to be the same guy who ran the Boston Fed.
Freddie Mac was already a damaged organization when Syron moved to Washington to take over the top job in 2004. The original mission: Help Freddie recover from a big accounting scandal.
Clearly, a lot of things happened at Freddie after that. Some former employees say Syron ignored internal warnings about risks. The SEC claims he did worse things than that.
I still have a hard time figuring out the story of Dick Syron’s disaster at Freddie Mac. Perhaps we’d hear it if this case ever gets to a trial.