A U.S. House panel will hold an oversight hearing on a report due on mortgage finance giant Fannie Mae’s multibillion-dollar accounting problems, according to a letter released by the House Committee on Financial Services late Thursday.
Separately, U.S. securities regulators approved a New York Stock Exchange proposal that could help Fannie Mae by allowing the Big Board to keep a company’s stock listed under certain circumstances even absent timely financial results, Reuters reported.
Fannie has not filed financial results for 2004 and 2005 as investigations into massive accounting errors continue. Problems identified so far are expected to result in a profit restatement of as much as $11 billion.
The first of two accounting probe reports is expected this month or early February from the investigator hired by Fannie Mae, former New Hampshire Sen. Warren Rudman.
Ohio Republican Rep. Michael Oxley, chairman of the House Financial Services Committee, and the top Democrat on that panel, Massachusetts Rep. Barney Frank, told the mortgage finance giant of their intent to hold an oversight hearing on that report in a letter on Jan. 19. That letter was released Thursday.
The lawmakers asked Fannie for a copy of the report, and asked that Rudman be available to testify.
“The purpose of the hearing will be to fully inform the Committee about the findings, conclusions and any recommendations contained in the Rudman report,” Oxley and Frank wrote.
Fannie’s accounting problems also are under investigation by its regulator, the Office of Federal Housing Enterprise Oversight, as well as other federal agencies. The regulator’s report is expected by the end of the first quarter.
Because of the investigations and lack of financial reports, Fannie had warned the continued listing of its stock on the New York Stock Exchange was at risk.
But the Securities and Exchange Commission, in a recently posted decision dated Jan. 19, approved a NYSE proposal that allows the exchange to decide in rare circumstances that a company that has failed to file timely financial results remains suitable for continued exchange listing because of its position in the market.
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