Alexandria, Va. (Feb. 5, 2004) -- A U.S. district judge here has ordered former Freddie Mac chief executive Leland Brendsel to testify in a federal probe into accounting errors at the government-sponsored mortgage financing concern.
Brendsel had been fighting a subpoena issued by the Office of Federal Housing Enterprise Oversight, the regulator charged with policing Freddie Mac and its larger sibling, Fannie Mae. However, the ruling upheld the summons, forcing Brendsel to appear before the OFHEO.
A series of accounting irregularities over a three-year period at Freddie Mac resulted in a $5 billion earnings restatement and the ouster of Brendsel and several other top officers at the company.
Back in December, the troubled mortgage securities concern agreed to pay a $125 million fine as part of a consent decree following a scathing OFHEO report that charged the organization with fostering "a pattern of inappropriate conduct and improper management of earnings.” It was the largest-ever civil penalty levied by what is known as a safety and soundness regulator. The McLean, Va.-based company neither admitted nor denied wrongdoing.
-- WebCPA staff
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