Industry News

New Fannie Mae accounting violations reportedly found

Mortgage giant's shares plunge after problems reported

Shares in Fannie Mae plunged Wednesday after a report was issued saying regulators found new accounting violations at the mortgage giant, which is already under scrutiny for alleged bookkeeping irregularities. A spokeswoman for the Office of Federal Housing Enterprise Oversight, which oversees Fannie Mae, would not confirm or deny Wednesday a Dow Jones report that the regulator has found extensive additional problems. "We have an ongoing examination and I have no comment," said Corinne Russell, a spokeswoman for the Office of Federal Housing Enterprise Oversight. Fannie Mae shares dropped more than 10 percent following the story, which said investigators discovered evidence executives overvalued assets, underreported credit losses, and misused tax credits. The article cited unnamed sources close to, or who have been involved in, the inquiries. The government-sponsored enterprise's shares closed at $41.71 Wednesday, a 10.69 percent drop. Stephen Blumenthal, acting director of OFHEO, i...