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Univ. of Toledo College of Law

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Friday, April 18, 2008

Raines Settles Charges with Ofheo

Remaining defiant to the end ("I did not break any laws or rules"), former Fannie Mae CEO Franklin Raines settled Ofheo charges that he manipulated the company's earnings.  The settlement, which also included two other former officers, provides that Fannie's insurer will make cash payments of about $3 million; the three officers will surrender stock options that are now worthless.  In addition, Ofheo said that Raines will donate proceeds from the sale of $1.8 million of Fannie Mae stock.  Ofheo had originally sought return of substantial amounts of cash compensation from the officers.  WSJ, Former Top Fannie Officials Won't Pay Any Cash in Settlement.

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