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Some of slowly SEC's they're slapping fraud charges on sixth.
Former Fannie Mae and Freddie Mac executives today the SEC claims a top exacts misled taxpayers and the government about risky sub prime mortgages.
The mortgage giants held.
For more on this developing story we've got developments is -- actions.
It would -- got breaking news -- PNC bank just put on administrative leave the former chief risk officer for Fannie Mae.
And he has been named in the SEC securities fraud charges which Chris also include the former Fannie -- -- top executive Daniel Mudd.
And former Freddie Mac top executive Richard Syron.
More breaking news here SEC sources telling Fox Business they may move -- the regulators for Fannie Mae Freddie Mac to try to claw back earnings that were basically given in the way of executive pay.
To the top executives.
Bid Daniel Mudd earned about sixteen million dollars in total competence cash compensation stock awards bonuses.
For the years and questions the alleged when -- alleged fraud happened and Richard Syron sixteen point nine million dollars.
Here's a PS EC is saying and it's charging document material misstatements.
Coming out of these executives at Fannie Mae -- Freddie Mac they misled the market say perpetrated half truths.
Also another hall more breaking news these two companies Fannie Mae and Freddie Mac.
Had joined the -- to join the SEC in -- who -- lawsuit against its former executives.
That means these executives might not be able to access directors and officers insurance which recover their little at the litigation expenses which is what you saw happen with Franklin Raines when he -- formerly.
-- you know former head of Fannie Mae.
-- was roped into basically.
And accounting fraud there and -- of clos have been paid back earnings of about 25 million dollars.
So here's the issue the wave that Fannie and Freddie misled the markets is key.
On the SEC is that Fannie is saying that these executives at Fannie Mae fraudulently reported.
That just 10%.
Of their book was actually risky meaning sub prime.
Went from four point three billion dollars or so went 48 billion dollars in the year -- -- pro seven was at risk of six -- Freddie Mac but told the markets is executive told the markets -- sub prime.
Exposure in 2006.
When actually would there was a 141 billion dollars worth of sub prime risky loans on the books.
Also that represent about 10% of Freddie -- book at that time.
That number Chris good to -- -- 44 billion dollars.
The SEC is also saying that Fannie Mae.
Misled the markets by giving a new -- to sub prime loans to mask their exposure to misstate what was going on.
They called an expanded loans when they're actually sub prime loans and -- -- sold -- with.
Fannie and Freddie joining the suit.
What they're basically saying is.
Don't save Fannie and Freddie knew XY and Z save these executives outside of the realm of their duties within Fannie and Freddie.
We're doing this not the organization not the institution as.
Yeah that's that's what's key and you know you have a cover accounting scandals in the past of the Wall Street Journal also reports.
Obtain this this is not new this Fannie Mae and other -- -- in the sense of Fannie Mae Freddie Mac have been in the dock.
Big accounting problem restatements and accounting frauds alleged against Freddie Mac from 1990 to 2002.
Thirty settled back -- for fifty million dollars at the SEC.
Fannie Mae -- 98 to 2004 that's when their accounting problems and alleged accounting fraud happened Fannie Mae settling for 400 million dollars at the SEC.
And their regulators so this is an ongoing saga.
Fannie Mae Freddie Mac will be Watson will this one.
As a news continues to break break Chris that you're interest and thank you so much George delighted well I real.
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