Government-chartered mortgage concern Freddie Mac agreed to pay $410 million to settle a shareholder lawsuit that had been lodged over accounting errors that led the company to restate some three years of earnings.

The Ohio Public Employees Retirement System was the lead plaintiff in the litigation over financial reporting violations that caused Freddie Mac to restate earnings from 2000 through 2002 by some $5 billion more.

Freddie Mac said that the payout would slash its first-quarter 2005 earnings by $220 million. Last month Freddie Mac, which had not filed its year-end 2005 earnings, estimated its 2005 profits at $2.5 billion.

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