Fannie Mae and Freddie Mac chiefs could face charges
The former chief executives of the US mortgage finance giants Fannie Mae and Freddie Mac could become the next senior figures facing fraud charges, as regulators pursue wrongdoing in the lead up to the credit crisis.
Richard Syron, who ran Freddie Mac until it was taken over by the US government in September 2008, has received notification from the Securities and Exchange Commission that it is planning to file civil charges alleging that Mr Syron's firm misled investors over its exposure to subprime mortgages, it emerged yesterday.
The notification came in the form of a so-called Wells notice, to which Mr Syron is given the opportunity to respond before charges are filed. Daniel Mudd, the former Fannie Mae chief executive, who now runs the hedge fund group Fortress, disclosed earlier this week that he too has received a Wells notice.
The forced nationalisation of Fannie Mae and Freddie Mac marked the start of the most tumultuous period of the credit crisis, coming just a week before Lehman Brothers went bankrupt.
The two companies operated with an implicit government guarantee in return for helping to promote homeownership among lower-income Americans, and because they owned or guaranteed the majority of US mortgages. They were deemed too big to fail by the Bush administration.
Under public conservatorship, the two firms have continued to require infusions of taxpayer funds in order to pay their debts. The SEC has been investigating whether Fannie and Freddie's public statements properly reflected the risks that the two firms were taking.
Both Mr Mudd and Mr Syron said that charges against them would be without merit.
Revealed: Devastating impact of 'bedroom tax' sees huge leap in demand for emergency hardship handouts for tenants
Notes from a small island: Is Sealand an independent 'micronation' or an illegal fortress?
You thought Ryanair's attendants had it bad? Wait 'til you hear about their pilots
Revealed: Eerie new images show forgotten French apartment that was abandoned at the outbreak of World War II and left untouched for 70 years
Chloe Johnson death: Family of five-year-old British girl who died in a pool at in Egypt's Sharm el-Sheikh resort 'angry' that more wasn't done to save her
- 1 Stoke City investigate 'religious abuse' after 'pig's head is found in Kenwyne Jones' locker'
- 2 Gove’s lesson: spare the comma, spoil the child
- 3 You thought Ryanair's attendants had it bad? Wait 'til you hear about their pilots
- 4 Join Ryanair! See the world! But we'll only pay you for nine months a year
- 5 It’s official: thanks to Stephen Hawking's Israel boycott, anti-Semitism is no more
BMF is the UK’s biggest and best loved outdoor fitness classes
Find out what The Independent's resident travel expert has to say about one of the most beautiful small cities in the world
Win anything from gadgets to five-star holidays on our competitions and offers page.
iJobs Money & Business
£550 - £600 per day: Orgtel: Fidessa Analyst / PM - Banking - London - Up to £...
£450 - £500 per day: Orgtel: Sourcing Manager - Banking - London - Up to £500p...
To be discussed at interview.: Queen Elizabeth's School: An experienced and ef...
£294.05 - £330.92 per day + 150 per day travel and accommodation: Orgtel: A le...