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Saturday, August 1, 2020 | History

2 edition of Accounting Irregularities at Fannie Mae and the Effect on Investors found in the catalog.

Accounting Irregularities at Fannie Mae and the Effect on Investors

Accounting Irregularities at Fannie Mae and the Effect on Investors

Hearing Before the Subcommittee on Capital Markets, Insurance and Government Spon

  • 120 Want to read
  • 32 Currently reading

Published by Not Avail .
Written in English


The Physical Object
FormatHardcover
Number of Pages54
ID Numbers
Open LibraryOL10116920M
ISBN 100160726689
ISBN 109780160726682

  Investigators looking into its accounting irregularities found that it had underreported profits by some $5 billion, whereas Fannie covered up its losses by inflating the value of the assets in.   Fannie Mae was created by the government in , and was turned into a shareholder-owned company 30 years later. Freddie Mac was established in to provide competition for Fannie.

The Loan Documents Loan Documents All documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. will provide acts of the Borrower Borrower Person who is the obligor per the Note. that are required to be performed, the failure of which may be designated as an event of default. There may be grace periods for curing such a default. CRS-2 1 See CRS Report RS, Accounting and Management Problems at Freddie Mac, by Mark Jickling. 2 Office of Federal Housing Enterprise Oversight, Office of Compliance, Report of Findings to Date: Special Exami nation of Fannie Mae, Sept. 17, , p.(Herea fter cited as OFHEO, Report of Findings.) The savings and loan crisis of the s was a painful demonstration of the risks.

  During the time Emanuel spent on the board, Freddie Mac was plagued with scandal involving campaign contributions and accounting irregularities. Freddie Mac and its sister organization Fannie Mae were taken over by the federal government in September after years of mismanagement and scandal.   Despite the continuing flow of accounting irregularities coming out of the firm, analsysts at Credit Suisse First Boston said Fannie Mae gained significant market share in its credit guaranty.


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Accounting Irregularities at Fannie Mae and the Effect on Investors Download PDF EPUB FB2

Get this from a library. Accounting irregularities at Fannie Mae and the effect on investors: hearing before the Subcommittee on Capital Markets, Insurance and Government Sponsored Entereprises [sic] of the Committee on Financial Services, U.S.

House of Representatives, One Hundred Ninth Congress, first session, February 9, [United States. "Accounting Irregularities at Fannie Mae" by Chairman Christopher Cox This practice was an improper departure from GAAP and had the effect of reducing earnings volatility.

Improved Disclosure to Fannie Investors. Fannie Mae's settlement of accounting fraud charges raises another very significant policy issue, one that has been carefully.

Cautionary Note Regarding Certain Previously Reported Financial Results – Investors and others should not rely on annual or quarterly financial information published prior to December For financial information forandinvestors and others should instead review and rely on Fannie Mae's Form K as filed with the SEC on Dec.

6, Spittler is a Senior Associate at KPMG and Ciklin is an investor in a number of start-up digitally based companies.

The result of their work is a conspiracy theory concerning the government takeover of Fannie Mae in which the public has been lied to concerning Fannie Mae’s financial condition in and in subsequent years.

Accounting irregularities at Fannie Mae and the effect on investors: hearing before the Subcommittee on Capital Markets, Insurance and Government Sponsored Entereprises [sic] of the Committee on Financial Services, U.S.

House of Representatives, One Hundred Ninth Congress, first session, February 9,   Fannie Mae. " Annual Report on Form K," Page 1. Accessed Ma Accessed Ma Fannie Mae. " Annual Report on Form K," Page 7. Abstract. Revelations of accounting irregularities and excessive risk-taking by the home mortgage giants Fannie Mae and Freddie Mac have led to calls for various reforms, in order to protect taxpayers who would likely have to pay the costs if one or both of the firms were to become insolvent.

Fannie Mae, the federally chartered company that buys home mortgages and sells them as securites, is receiving a highly public accounting issues arose last summer at Fannie’s. The "Special Examination of Fannie Mae" was a dense pages packed with technical accounting details.

But the message was clear: OFHEO accused Fannie Mae of both willfully breaking accounting rules and fostering an environment of "weak or nonexistent" internal controls. Fannie Mae's J media call includes forward-looking statements, including statements relating to: the impact of the COVID pandemic on the company's business and financial results; economic and housing market conditions; the impact of the company's potential future capital requirements; the company’s business plans and strategies; and the credit quality and performance of its book.

Fannie Mae essentially established OFHEO in as the regulatory agency that oversaw its operations and accounting. Fannie Mae was able to control its own regulator because it had enough influence in Congress to have OFHEO’s budget cut. Fannie Mae had political influence because of its connections with realtors, homebuilders, and trade groups.

Pass-through securities issued by Freddie Mac, Fannie Mae, and Ginnie Mae trade in the TBA market, and the term TBA is derived from the fact that. The principal investigators determined that Fannie Mae's the accounting irregularities were not tied to any attempts to garner executive bonuses but that historical accounting practices, internal.

The main allegations at Fannie have been long known to investors. From throughthe company overstated its earnings by $ billion. there's no evidence that Fannie Mae's accounting.

This study seeks to establish the nature of the scandal at Fannie Mae, how it managed to hide those irregularities, the factors that motivated those abuses, the impact on the stakeholders, as well as the solutions recommended to the problem. Fannie Mae and its Fraudulent Operations.

The scandal at Fannie Mae can be traced between and   Senior executives at Fannie Mae manipulated accounting to collect millions of dollars in undeserved bonuses and to deceive investors, a federal report charged Tuesday.

The. "Strong accounting controls, though a recognized cost center, can significantly help detect and deter violations of the federal securities laws," said Paul R. Berger, Associate Director of Enforcement. "Fannie Mae failed to devote sufficient resources to its accounting, and the results for the company and for its investors have been unfortunate.

Investors must care because proof of accounting missteps could trigger a drawn-out process of accounting restatement at Fannie similar to the one that is.

A Security and Exchange Commission investigation uncovered accounting irregularities in Fannie Mae’s books and a false reporting of $9 billion in past profits.

At the time of Raines early retirement from Fannie Mae, the Democrat reportedly earned $20 million in salary and bonuses. Fannie Mae agrees to huge civil penalty for accounting irregularities.

The company's management made two additional adjustments in the fourth quarter of that had the effect of offsetting. Serious concerns exist regarding the risk management practices and the federal oversight of the housing government-sponsored enterprises (GSE)--Fannie Mae, Freddie Mac, and the Federal Home Loan Bank System (FHLBank System), which had combined obligations of $ trillion as of year-end InFreddie Mac disclosed significant accounting irregularities.immediately unleashing unpredictable effects on its counterparties or the financial system.

Inwe learned that Fannie Mae’s accounting was revealed to be faulty. In DecemberFannie restated its earnings for, and the first half ofrevealing that it had over - stated its earnings by a total of about $6 billion.This had the effect of shrinking the share of total residential mortgage debt insured or owned by Fannie Mae and Freddie Mac.

At the start ofthe two agencies issued or guaranteed almost 54% of all mortgage debt. By summertheir share had fallen to 40% (see Figure ).

That shrinking market share undercuts arguments that the.