Pressured by OFHEO, Freddie Ousts CEO, GC

Under pressure from its regulator, Freddie Mac agreed late Friday night to remove its chief executive, Greg Parseghian, and launch a search for a successor.Mr. Parseghian, however, will remain as CEO until a replacement can be found. As reported by MortgageWire early Friday, the board had been considering a successor for at least three weeks. Late Friday, though, the Office of Federal Housing Enterprise Oversight officially asked the board to immediately remove Mr. Parseghian and its general counsel, Maud Mater. The congressionally chartered mortgage giant agreed. OFHEO is conducting an investigation of the accounting and management practices of the company. Freddie Mac is expected to restate earnings upward for the past three years by about $4.5 billion. In June, it fired its president, David Glenn, and forced its long-time chairman and CEO, Leland Brendsel, into retirement. In the wake of the scandal, several company officials have been fired or resigned. Three names are being mentioned as possible successors to Mr. Parseghian: retired Fannie Mae chairman James Johnson; former Bush administration economic adviser Lawrence Lindsey; and Peter Fisher, the soon-to-be-departing secretary for domestic finance at the Treasury Department. A source familiar with the matter said that a month or so ago Mr. Parseghian was considering tapping Mr. Johnson as an informal adviser. A recent shareholder lawsuit filed against Freddie Mac, and Messrs. Parseghian, Brendsel, Glenn, and former chief financial officer Vaughn Clarke, accuses all four men of making "insider trading proceeds." Mr. Parseghian has denied any wrongdoing in regard to his stock sales. The other three men have yet to comment.