Fannie to Report on Employee Misconduct

On Oct. 23, Fannie Mae will report on its review of current employees and directors and recommend disciplinary actions against specific individuals as a result of their involvement in the company's $10 billion accounting scandal.As part of a consent agreement with it regulator, the Office of Federal Housing Enterprise Oversight, Fannie Mae was required to review the conduct of all individuals identified by OFHEO in a May 2006 examination report about the government-sponsored enterprise's efforts to manipulate earnings. The report that Fannie will deliver to OFHEO on Monday will not only identify what actions should be taken against individuals but will also include plans to seek restitution, disgorgement, or other remedies. "I am waiting to see their recommendations, and then we will look and see if we agree," OFHEO Director James Lockhart told reporters. Fannie Mae can be found online at http://www.fanniemae.com.