BusinessCompany NewsEx-Fannie Mae execs settle over accounting fraud

Ex-Fannie Mae execs settle over accounting fraud

Three former Fannie Mae senior executives have agreed to pay $31.4m (£15.7m) to settle accounting fraud allegations

Three former
Fannie Mae
senior executives who had been accused for manipulating the books for six years
to meet profit and bonus targets, have all agreed to pay $31.4m (£15.7m) to
settle the allegations of accounting fraud in 2004.

Franklin Raines, former head of Fannie Mae, who worked in the Clinton
administration and will pay the lion’s share of $24.7m, has denied any
wrongdoing, while Timothy Howard, ex-chief financial officer, has agreed to pay
$6.4m; and ex-controller Leanne Spencer, former controller, $275,000, BBC
News
reports.

The penalties are nowhere near the $215m sought by the Office of Federal
Housing Enterprise Oversight, the government regulator of the US mortgage
market.

The multi-billion dollar accounting scandal at Fannie Mae, which finances or
guarantees one of every five home loans in the US, left Wall Street
shellshocked, resulting in restriction of its capital requirements until
recently.

Further reading:

Freddie Mac pays up over fraud

Read
story in BBC News

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