Former Fannie Mae Chief Executive Officer Franklin Raines used the company's charity to compromise the independence of six current directors at the largest U.S. mortgage finance company, according to a suit filed by shareholders in U.S. District Court in Washington, D.C., Bloomberg News reported. Raines allegedly dispensed grants exceeding $12 million from the Fannie Mae Foundation to groups such as the Brookings Institution and the John F. Kennedy Center, discouraging directors tied to the organizations from challenging policies that led to $10.8 billion in accounting errors, according to the complaint, reports said. Raines, who chaired the board and the foundation, "dominated his fellow board members," said the suit filed Monday, according to reports. "In more than 78 board meetings, 48 audit committee meetings and 38 compensation committee meetings, defendants never raised any opposition to Raines, enabling and fostering the perpetuation of his schemes," the suit alleged. The plain...
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