OFHEO Enters Into Consent Order With Freddie Mac

September 13, 2005

WASHINGTON, D.C. —The Office of Federal Housing Enterprise Oversight (OFHEO), safety and soundness regulator for Fannie Mae and Freddie Mac, announced an agreement with Freddie Mac to settle the action brought against the company by OFHEO in late 2003. That action involved former employees allegedly engaging in improper accounting practices and failing to maintain proper internal controls.

“This settlement with the company is a significant step forward and allows us to focus our resources on the cases against former officers,” said OFHEO Acting Director Stephen A. Blumenthal.

As part of the stipulated consent order, Freddie Mac agreed to assist OFHEO in its ongoing administrative actions against the Enterprise’s former CEO Leland Brendsel and CFO Vaughn Clarke. Freddie Mac agreed to additional steps, e.g. seeking recovery of funds from separated officers, following the administrative actions against the former officers. The settlement follows a related action in which the Enterprise paid a civil money penalty of $125 million in connection with allegedly improper accounting and inadequate governance practices.

Source: OFHEO

Contact ALTA at 202-296-3671 or communications@alta.org.

North American Title Insurance Company (NATIC) is a seasoned title insurance underwriter, helping title agents to achieve their individual business goals for more than 50 years. Today, the company conducts real estate settlement services in 39 states and the District of Columbia through a network of experienced, independent agents.