Fannie Mae chief executive officer Daniel Mudd will not spearhead the company's review of employees who may have been involved in its $10.8 billion accounting scandal.In a statement issued late Thursday, Fannie chairman Stephen Ashley said four directors -- all with board service of less than two years -- will oversee the review instead. The review is mandated under Fannie's $400 million legal settlement with its regulator and the Securities and Exchange Commission. (On May 23 the company was formally accused of fraud by the government.) Fannie Mae officials were not elaborating on the decision, but a source familiar with the matter said, "This is not a reflection on Dan." Mr. Ashley's statement also included a vote of confidence in Mr. Mudd, saying that the directors have "full confidence in Dan's leadership." Messrs. Ashley, Mudd, and other past and present executives and directors are defendants in a shareholder lawsuit that accuses them of turning a blind eye to the company's accounting woes because they were involved in "mutually beneficial relationships" with the GSE and did not operate as independent directors. Fannie Mae is trying to get the lawsuit dismissed. The government-sponsored enterprise can be fund online at http://www.fanniemae.com.

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