The government will pursue some Fannie Mae executives to recover bonus money they reaped in an accounting scheme, if the mortgage giant itself fails to do so, an official said Thursday, according to media accounts.

At his confirmation hearing Thursday to become permanent director of the Office of Federal Housing Enterprise Oversight, James B. Lockhart also told senators he would maintain his independence as the chief regulator of embattled Fannie Mae and its smaller government-sponsored sibling, Freddie Mac, accounts said.

Lockhart is now acting director of OFHEO. He appeared before the Senate Banking Committee with three other nominees for positions with independent regulatory agencies.

The OFHEO, which Lockhart would head if confirmed, last month issued a scathing report alleging a six-year accounting fraud at Fannie Mae. It said employees manipulated accounting to hit company quarterly earnings targets so senior executives could pocket hundreds of millions in bonuses from 1998 to 2004.

“The first line of defense is that the board of Fannie Mae should go after these individuals and try to get restitution” of some of the bonus money, Lockhart testified Thursday, according to accounts. The directors owe the shareholders no less, he said, and if they fail to do so his agency will pursue the executives, media accounts said.

Show Comments Hide Comments

Comments

Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription