OFHEO Wants Fannie Board to Act

Fannie Mae's directors are talking to the Office of Federal Housing Enterprise Oversight regarding possible remedial action by the board against the mortgage giant's management, agency officials said at a news conference late Thursday morning.OFHEO also released a letter it gave to Fannie's board that says, "...we must consider the accountability of management and whether we have sufficient confidence in management to fully implement these corrective measures and bring about broad cultural and operational changes in the areas of concern. The analysis and findings of this report [see items below] make it difficult to assert such confidence." When Freddie Mac's accounting scandal first became public in June 2003, the board had fired three of its top officers, including chairman and chief executive Leland Brendsel. Despite allegations of serious accounting improprieties at Fannie -- including the deferment of $200 million in expenses so executives could earn their bonuses one year -- not one senior manager has resigned or been fired at Fannie Mae.