On August 6, 2007, Judge Richard J. Leon of the United States District Court for the District of Columbia appointed Bernstein Liebhard LLP as Co-Lead Counsel for the Ohio Public Employees Retirement System and the State Teachers Retirement System of Ohio in the Fannie Mae Securities Litigation. Bernstein Liebhard joins Lead Counsel, Waite, Schneider, Bayless & Chesley Co., L.P.A., in the prosecution of the class’s claims.
The action arose after Fannie Mae publicly revealed on Sept. 22, 2004, that its regulator, the Office of Federal Housing Enterprise Oversight (“OFHEO”), had found that Fannie Mae and its three most senior officers had intentionally misapplied accounting rules and engaged in other misconduct to distort financial results and “smooth earnings growth quarter over quarter.” Fannie Mae’s common stock price fell from $75.65 per share on Sept. 21, 2004, to $70.69 per share on Sept. 22, 2004 on this news.
After the close of markets that same day, OFHEO released a 198-page report on the accounting irregularities at Fannie Mae, characterizing them as “pervasive” and “reinforced by management.”
As Fannie Mae officials publicly disputed OFHEO’s findings, the U.S. Department of Justice and the Securities and Exchange Commission (SEC) launched their own investigations into the Fannie Mae’s accounting practices. On Dec. 15, 2004, the SEC ordered Fannie Mae to restate earnings back to 2001 because Fannie Mae had not complied with Generally Accepted Accounting Principles in preparing its financial statements. Those corrections, contained in the restatement filed by Fannie Mae on Dec. 6, 2006, reduced previously reported earnings by $6.3 billion.
For more information about the action please visit the Fannie Mae Securities Litigation website at If you would like to discuss the action with one of our attorneys, please contact info@bernlieb.com.
