The Office of Federal Housing Enterprise Oversight, the regulator for mortgage financing concern Fannie Mae, said it intends to sue ousted chief executive Franklin Raines and former chief financial officer Timothy Howard in an effort to recover salaries from the time the company overstated earnings by billions.
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News of the suit comes just days after Raines received $2.6 million as a “deferred compensation” settlement after being jettisoned from the company in 2004.
An OFHEO report issued in May said that Fannie employees manipulated accounting to hit quarterly earnings targets and allow senior executives to collect performance bonuses between 1998 and 2004.
Raines earned more than $90 million from 1998 to 2003, according to that report -- including more than $50 million in bonuses tied to the company hitting earnings targets.
Raines has repeatedly denied that he engaged in any wrongdoing.