Fannie Mae Told to Save Documents
Mortgage giant Fannie Mae, gripped by an accounting scandal and under investigation by the Justice Department, disclosed Tuesday that prosecutors had asked the company to preserve documents as part of the criminal probe.
In a regulatory filing, the government-sponsored company also reported that it had been informed of eight lawsuits on behalf of shareholders that were being prepared or had been filed against it, Chairman and Chief Executive Franklin Raines and Chief Financial Officer Timothy Howard.
Several such suits have been announced since Sept. 22, when accounting questions at the company came to light amid news of a Securities and Exchange Commission inquiry into accounting at Fannie Mae, which finances one of every five home loans in the United States.
Fannie Mae said in its filing with the SEC that the U.S. attorney’s office in Washington, which is pursuing the criminal investigation, had asked it to preserve certain documents, including papers related to a report by the Office of Federal Housing Enterprise Oversight that alleged earnings manipulation to meet Wall Street expectations and accounting improprieties by the company.