WASHINGTON (CN) – The Securities and Exchange Commission is on the job. Possibly acting on a tip from thousands of articles in daily newspapers, the SEC claims that the Federal Home Loan Mortgage Corp. aka Freddie Mac juggled its books to the tune of $6.4 billion in fiscal years 2000 – 2002.
The SEC says Freddie Mac defrauded investors, violated accounting principles and falsely reported earnings. It says the frauds were directed by defendants President David Glenn, CFO Vaughn Clarke, and Senior Vice Presidents Robert Dean and Nazir Dossani. Freddie Mac exaggerated its earnings by $1.1 billion in 2000, by $989 million in 2001, and by $4.3 billion in 2002, the SEC says. It demands penalties and injunction. See the federal complaint.