Ralph Nader, the anti-corporate crusader, said he purchased about 100,000 shares of Fannie Mae and Freddie Mac prior to the federal take-over. Looking back, Nader said he probably held on too long. The mortgage giants are profitable again, but investors say they’re still waiting for their rewards. (Jacquelyn Martin/AP)

Fannie Mae and Freddie Mac were left for dead after the government seized the mortgage giants in the midst of the 2008 financial crisis. Their stock tanked, and many shareholders fled.

Now the companies are flying high again, having cranked out more than $200 billion in profits, most of it in the past two years, as the housing market’s recovery took shape. D.C.-based Fannie and McLean, Va.-based Freddie reported Thursday an additional $9 billion in profits for the first quarter.

Loyal investors, including Louise Rafter of California, are waiting for their reward.

“I had this little thought that maybe one day, the shares would be worth something again,” said Rafter, 90, who has owned Fannie stock for decades.

The prospects are not good.

A Senate panel is expected to vote on a bill as soon as next week that would dismantle the companies in a bid to shift the risks of mortgage lending from the taxpayers to the private sector. The bill, which has bipartisan support and the endorsement of the Obama administration, would leave ordinary shareholders such as Rafter with nothing.

Now, a big fight is brewing as hedge funds and other monied investor groups try to stop Congress and undo what they see as a massive government rip-off. Many of these groups swooped in after the bailout and snapped up Fannie and Freddie shares on the cheap, betting that the firms would roar back. Most bought preferred shares, positioning themselves ahead of ordinary investors to collect a piece of the profits.

Even if the bill does not reach the Senate floor this year, and many expect it won’t, small investors still may not benefit from Fannie’s and Freddie’s profits. The government suspended the once-generous dividends in 2008, and four years later demanded that the firms send all of their profits to the U.S. Treasury. That eliminated any chance of shareholders recovering value from the companies.

Investors have filed more than a dozen lawsuits to challenge the arrangement, and a well-funded campaign is underway to derail the legislation and go after lawmakers who support it. Various coalitions, some of which have refused to disclose their donors, are sinking millions into an advertising blitz, including radio ads that cast the Senate proposal as an Obamacare-style effort.

Left watching from the sidelines are ordinary investors such as Rafter, a widow whose husband bought a few hundred Fannie shares long ago and saw the shares split and the dividends grow, generating $50,000 for the couple in some years.

“Then it was gone,” Rafter said. “That’s just really hard to take.”

Fannie and Freddie once traded at $80 and $70 a share, respectively. Their stock has lumbered in the $1 to $6 range during the past year.

Fannie Mae and Freddie Mac officials declined to comment on the investor lawsuits and the Senate legislation.

The government created the companies decades ago to boost the supply of mortgages and reduce their cost. They buy loans from lenders, package them as securities and sell them to investors. They also insure the mortgages and pay investors if the loans go bad. Fannie and Freddie evolved into two of the world’s largest financial institutions, and their shares were listed on the New York Stock Exchange. They reliably generated enormous profits until the financial crisis hit and foreclosure rates shot up.

During the housing bust, the companies suffered massive losses. Fearing that the losses would overwhelm the companies’ capital and crater the global economy, the government stepped in and began supporting them with what grew to $188 billion in taxpayer dollars.

Without that help, the firms would have been liquidated long ago and their shareholders wiped out because “no other source of capital was willing or able to invest,” including the large investors now trying to lay claim to the profits, the Justice Department said in a court document related to one of the investor lawsuits.

Obama administration officials declined to comment on the investor lawsuits. But the White House has long argued against keeping Fannie and Freddie as is and supporting a structure in which the desire for private profit exposes the public to unreasonable risks.

They have also said that the companies are not as profitable as they seem because their recent income stream has been substantially boosted by one-time gains. On Thursday, Fannie and Freddie said that a sizable portion of their first-quarter earnings came from legal settlements tied to shoddy mortgages, and Freddie warned that its profits are not sustainable over the long term. The companies’ regulator, after conducting mandatory stress tests, recently projected that Fannie and Freddie could require as much as $190 billion more in taxpayer support under the most extreme scenario tested, one that assumes a severe economic downturn and dramatic home price declines.

Now is the time to reform the housing finance system “instead of waiting until the next crisis to address this complex issue,” Michael Stegman, the Treasury Department’s housing adviser, said Thursday at a conference in Orlando.

But many shareholders — both big and small — have a different take on what should happen next. They say the government duped them into believing that it was nursing Fannie and Freddie back to health, allowed the companies’ shares to keep trading (albeit not on a major exchange) and then unlawfully took the profits and left shareholders out in the cold.

Steve Rattien, a D.C. resident, said he thought he was making a fairly conservative investment when he bought 1,000 shares of Fannie for $60,000 more than a decade ago. He said he thought the company’s steady income stream would stay strong because it was backing mortgages, which were a sound investment at the time.

“I don’t begrudge the government the right to restructure the industry if they feel that’s not the right way to secure mortgages and keep the economy steady,” said Rattien, 71. “But this seems like a taking to me, which is what the new investors are saying.”

Ralph Nader, the anti-corporate crusader, said he purchased about 100,000 shares of Fannie and Freddie before the federal takeover, and he held on to them because he relied on public statements from high-level government officials who said the firms were sound. Looking back, Nader said he probably held on for too long. “The reasons get into shareholder psychology,” he said. “It wasn’t the smart thing to do.”

Nader said he finds himself forging unusual alliances with hedge funds and other monied investors. He recently appeared alongside super-lawyer Theodore Olson at a Washington event to denounce the government’s efforts. Olson represents the hedge fund Perry Capital, which is suing the government.

Other groups have jumped into the fray, sinking money into advertising campaigns designed to undermine the Senate legislation.

“We haven’t broken the bank yet. We’ve just started,” said Kenneth Blackwell, head of the Coalition for Mortgage Security, which has paid $200,000 for online ads. “I don’t view this as a 100-yard sprint. I view it as a long-distance marathon.”

The coalition, which declined to disclose its donors, recently targeted Sen. Mike Crapo (R-Idaho), the lead sponsor of the Senate bill, in one ad. In another, it praised Sen. Patrick J. Toomey (R-Pa.), who has publicly sided with the investors.

The 60 Plus Association, a conservative group focused on senior issues, unleashed a $1.6 million television and radio ad campaign in early April blasting Sen. Mark R. Warner (D-Va.) and colleagues who support the Senate bill. It unleashed a second round soon after, placing ads on WTOP radio during pricey drive-time hours in the Washington area. The coalition declined to disclose its donors.

“Independent fact-checkers have said these ads go to absurd lengths to mislead people,” said Warner, a lead architect of the Senate bill.

The mutual fund Fairholme Capital Management is bankrolling another group called United for American Homeownership, a coalition of civil rights and business groups that has run television and print ads pushing for the preservation of Fannie and Freddie.

Fairholme — which owns about 155 million shares of Fannie and Freddie — also filed one of the high-profile lawsuits pending against the government.

If investors prevail in the lawsuits and the court decides that Fannie and Freddie have given enough money to the government, whatever is left over would go to shareholders. The first in line for dividends would be the “junior preferred” shareholders, including Fairholme and Perry Capital. The common shareholders could then get dividends under certain circumstances.

Treasury would get first dibs because the government acquired rights to buy 79.9 percent of Fannie and Freddie common shares as part of the terms of the bailout. Next in line would be the rest of the common shareholders, such as Rafter and Nader — and even Pershing Square Capital Management, which owns a sizable chunk of the common shares.

Senators have punted the shareholder issue to the court. But there is growing consensus in both parties that investors should not be rewarded for the risks that taxpayers took to rescue the companies, several analysts said.

No amount of money is large enough to repay the taxpayers for that gamble, said Jaret Seiberg, an analyst with Guggenheim Securities. “The fight now is about whether the taxpayers or the shareholders should get the windfall,” Seiberg said.

This story has been updated to correct that Perry Capital, not Pershing Capital, holds “junior preferred” shares in Fannie Mae and Freddie Mac.

Jennifer Jenkins and Alice Crites contributed to this report.