Freddie Mac, one of the biggest casualties of the US sub-prime mortgage
crisis, has parachuted in its former CEO to help prepare its quarterly numbers
after the shock death of its CFO David Kellermann.
David Moffett, the former government-appointed CEO who resigned from the
mortgage capital provider in March, will return as a consultant to the company’s
interim CEO John Koskinen.
The company, currently dealing with a government probe into its financial
reporting was dealt a hammer blow last week when Kellermann was found dead at
his Virginia home. His death has been widely reported as a suicide. Reports in
the US say he was warned to take time off shortly before he died.
Freddie Mac said: ‘In his role as a consultant, David Moffett will provide
advice and assistance to the interim CEO in directing the finance division and
overseeing the issuance of accurate and timely financial statements.’
Acting CEO John Koskinen added: ‘I am grateful to David for offering to
assist us during this challenging time.’
‘David is well positioned to advise me in my oversight of the finance
function. He knows the company well from his time as chief executive and has
built an impressive career in finance and accounting leadership as an executive
with other leading public companies.’
Moffett is well-regarded on Wall Street and in banking circles after helping
build a regional Ohio bank into heavyweight US Bancorp through a series of
mergers. The bank is well known for its operating efficiency and prudent risk
He was CFO of that company and its predecessors for 14 years until leaving in
2007 after being passed over for the top job of CEO.
Freddie Mac said it will be continuing its search for a permanent CFO to lead
the finance division after Kellermann’s unexpected death.
The mortgage heavyweight has made it possible for one-in-six US homebuyers
and more than five million renters to secure homes, but ran into serious trouble
as people began to default on their mortgage payments last year.
The American government swooped in to rescue the company in September 2008 as
the sub-prime storm battered the US economy and instigated a boardroom clearout
of Freddie Mac’s top brass.
This led to Kellermann’s promotion to the CFO role after almost two decades
with the company, but he faced a challenging debut.
In charge of a 500-strong finance function, Kellermann had been fine-tuning
the company’s first-quarter financial report. However, he had found himself
under increasing pressure as the SEC probe continued.
Freddie Mac said last week: ‘David was a man of great talents. He dedicated
those talents to Freddie Mac for more than 16 years, serving in many business
and finance capacities before recently taking the reins as acting chief
‘His extraordinary work ethic and integrity inspired all who worked with him.
David was a friend to many in the Freddie Mac family, and we mourn his passing.’
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