Federal investigators probing accounting problems at Fannie Mae are now questioning how the No. 1 U.S. home finance company treated trusts that it set up to sell securities.
Shares of Fannie Mae tumbled more than 6 percent on the news, briefly dropping $3.28 to $49.96 on Monday before recovering to $50.69, off 4.7 percent in midday trading on the New York Stock Exchange. The stock had not been below $50 since August 2000.
Fannie’s U.S. regulator, the Office of Federal Housing Enterprise Oversight, said on Monday it was investigating the company’s use of “qualifying special purpose entities” to account for trusts it uses to issue mortgage-backed securities.
For this complete story, please visit Fannie Probe Widens, Includes MBS-Issuing Trusts.
