Wolf Haldenstein Adler Freeman & Herz LLP Commences Class Action Lawsuit on Behalf of Federal National Home Mortgage Association Investors

Business Wire, Sept 23, 2008

NEW YORK -- On September 18, 2008, Wolf Haldenstein Adler Freeman & Herz LLP filed a class action lawsuit in the United States District Court, Southern District of New York, on behalf of all persons who purchased or otherwise acquired the securities of Federal National Home Mortgage Association ("Fannie Mae" or the "Company") [NYSE:FNM] between November 9, 2007 and September 5, 2008, inclusive (the "Class Period"), against the Company and certain officers and directors, alleging fraud pursuant to Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the "Exchange Act"), 15 U.S.C. SSSS 78j(b) and 78t(a) and the rules and regulations promulgated thereunder by the SEC, including Rule 10b-5, 17 C.F.R. SS 240.10b-5 (the "Class").

The case name is styled Fogel Capital Management, Inc. v. Federal National Home Mortgage Association. A copy of the complaint filed in this action is available from the Court, or can be viewed on the Wolf Haldenstein Adler Freeman & Herz LLP website at www.whafh.com.

Throughout the Class Period, Defendants made statements to Plaintiff and the other investors that were materially false and misleading because they failed to warn investors that the Company was undercapitalized and would continue to be undercapitalized even after raising billions of dollars in capital via preferred stock offerings. Defendants also issued false financial reports which misrepresented the Company's financial condition and inflated the Company's reported net worth. Defendants improperly accounted for Fannie Mae's investments, deferred tax assets and guaranty obligations, thus overstating the Company's assets and understating its liabilities in order to avoid having the Company's net worth fall below the minimum capital amount required by regulators.

On September 7, 2008, as part of the largest government bailout in history, federal regulators, concerned about the continued undercapitalization of Fannie Mae and worried of an imminent collapse, seized control of Fannie Mae and placed it into a conservatorship. The result of the Government's action was that the Company's already beleaguered stock price plummeted another 90% to close at $0.73 per share on September 8, 2008, wiping out almost all shareholder value in the Company.

As a result of the dissemination of the false and misleading statements set forth in the complaint, the market price of Fannie Mae securities was artificially inflated during the Class Period. In ignorance of the false and misleading nature of the statements described in the complaint, and the deceptive and manipulative devices and contrivances employed by said defendants, plaintiff and the other members of the Class relied, to their detriment, on the integrity of the market price of Fannie Mae securities. Had plaintiff and the other members of the Class known the truth, they would not have purchased said securities, or would not have purchased them at the inflated prices that were paid.

If you purchased or otherwise acquired Fannie Mae securities during the Class Period, you may request that the Court appoint you as lead plaintiff no later than November 7, 2008. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Wolf Haldenstein, or other counsel of your choice, to serve as your counsel in this action.

Wolf Haldenstein has extensive experience in the prosecution of securities class actions and derivative litigation in state and federal trial and appellate courts across the country. The firm has approximately 70 attorneys in various practice areas; and offices in Chicago, New York City, San Diego, and West Palm Beach. The reputation and expertise of this firm in shareholder and other class litigation has been repeatedly recognized by the courts, which have appointed it to major positions in complex securities multi-district and consolidated litigation.

If you wish to discuss this action or have any questions, please contact Wolf Haldenstein Adler Freeman & Herz LLP at 270 Madison Avenue, New York, New York 10016, by telephone at (800) 575-0735 (Gregory M. Nespole, Esq., Gustavo Bruckner, Esq., Martin Restituyo, Esq. or Derek Behnke), via e-mail at classmember@whafh.com or visit our website at www.whafh.com. All e-mail correspondence should make reference to Fannie Mae.