Freddie Mac and Fannie Mae Receive Subpoenas
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By Maya Nesbit
Published: September 29, 2008
Fannie Mae and Freddie Mac, the mortgage finance giants that were taken over by the government this month, said Monday that they were subpoenaed for documents as part of a federal grand jury investigations into their accounting, that’s according to the New York Times.
The United States attorney’s office for the Southern District of New York subpoenaed the two on Friday for documents related to accounting, disclosure and corporate governance dating from Jan. 1, 2007, to the present.
The Securities and Exchange Commission is also investigating these matters and directing the companies to preserve the documents, Fannie Mae and Freddie Mac said. Both companies said they would cooperate.
The Federal Bureau of Investigation said last week that it was expanding its inquiry of possible corporate fraud related to the mortgage market collapse to include Fannie Mae, Freddie Mac, Lehman Brothers and the giant insurer American International Group.
The allegations would deal with misstatements of assets, the F.B.I. director, Robert Mueller, told Congress earlier this month.
Financial upheaval tied to the mortgage market meltdown has propelled the government toward a $700 billion financial rescue package.
With the broader stock markets down more than 3 percent, shares of Fannie Mae were up more than 6 percent at $2.11 and Freddie Mac’s shares were little changed at around $1.85.
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