Industry News

More Fannie Mae investigations open

Justice Department, Ohio Attorney General eye company's accounting practices

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Ohio Attorney General Jim Petro on Thursday launched an investigation into mortgage heavyweight Fannie Mae to find out whether the company's accounting practices caused any losses to Ohio's public pension funds. Petro last year sued Fannie's rival company Freddie Mac on allegations that the company's accounting methods caused Ohio's pension funds to lose more than $25 million in stock value. In the last week, Fannie Mae's stock has dropped 18 percent, equivalent to $16 billion in market capitalization. The U.S. Congress has launched a committee hearing on the firm's accounting woes, and the Office of Federal Housing Enterprise Oversight issued a scathing report on Fannie Mae. In addition, the Securities and Exchange Commission launched an informal investigation, and several news sources this week reported the U.S. Department of Justice has opened its own investigation. "Our goal is to determine if there were losses of funds invested on behalf of members of the public pension systems i...