Fannie's facing a criminal probe

0 Comments | USA TODAY, October, 2004 | by Greg Farrell

Federal prosecutors have opened a criminal investigation into possible accounting fraud at Fannie Mae, says a Justice Department official familiar with the matter.

News of the investigation, first reported in Thursday's Wall Street Journal , helped drive the company's shares down 4.3% to a closing price of $63.40. They reached a 52-week high of $80.82 last winter.

Justice Department spokesman Bryan Sierra would not comment.

Since last week, when the Office of Federal Housing Enterprise Oversight (OFHEO) released a blistering report accusing the mortgage investment giant of using "cookie jar" accounting maneuvers to achieve its earnings targets, some members of Congress have loudly renewed calls for legislation to strengthen federal oversight of Fannie Mae and...