Freddie COO Fired for 'Lack of Cooperation'

The firing of Freddie Mac president and chief operating officer David Glenn was prompted by "his lack of cooperation and candor" with a special counsel appointed by the board of directors' audit committee to investigate accounting errors.Mr. Glenn did not provide "open and candid responses to the questions he was asked," Freddie Mac's new president and chief executive Gregory Parseghian said during a conference call. When he submitted personal diaries to the special counsel, he admitted that they were altered and pages were missing. Mr. Parseghian also said Mr. Glenn provided information about what was altered, but the new CEO said he didn't know whether Mr. Glenn had provided any information from the missing pages. Freddie Mac officials emphasized that they are not characterizing Mr. Glenn's misconduct as fraud, and they maintain that it does not have any effect on the economics or value of the publicly traded company or its risk management position. Meanwhile, the Office of Federal Housing Enterprise Oversight said it is initiating an investigation into misconduct by Freddie Mac employees. Mr. Parseghian, who met with OFHEO Director Armando Falcon Jr. early Monday morning, said he is only aware of one employee who is a target of the OFHEO investigation. The resignation of executive vice president and chief financial officer Vaughn Clarke is not linked to misconduct, he said.