Fannie Nixes '04 Bonuses

Fannie Mae's board of directors has decided not to pay 2004 cash bonuses to its top executives while the troubled company is restating its earnings going back to 2001.Fannie also revealed in a Securities and Exchange Commission filing that its comptroller and principal accounting officer, Leanne Spencer, has stepped down and David Hisey will become the new comptroller on Feb. 1. Mr. Hisey, a certified public accountant, previously worked at BearingPoint Inc. Cash bonuses and stock awards provided by the government-sponsored enterprise to its top executives have come under heavy criticism as a result of an overstatement of earnings by an estimated $9 billion. Rep. Richard Baker, R-La., has called on Fannie's regulator to take action to recapture all bonuses paid to company executives that were awarded based on "faulty and deeply flawed" earnings statements. Fannie Mae also revealed that it will pay its new chairman, Stephen Ashley, a $500,000 annual fee and interim chief executive Dan Mudd a $746,209 annual salary. Former chairman and chief executive Franklin Raines, who officially retired in December, received a $1.1 million annual salary.