A report issued today from the [tag]Office of Federal Housing Enterprise Oversight[/tag], or [tag]Ofheo[/tag], said that [tag]Fannie Mae[/tag]’s [/tag]quarterly earnings[/tag] were manipulated and the company engaged in [tag]improper accounting[/tag]. The report further stated that management was allowed to disregard [tag]accounting regulations[/tag] as long as [tag]earnings targets[/tag] were achieved, and that bonuses were awarded to those who hit targets.

Fannie Mae agreed to pay a $400 million fine to settle investigations by Ofheo and the [tag]Securities and Exchange Commission[/tag]. $350 million will be paid to the [tag]SEC[/tag] as a [tag]civil penalty[/tag] and will be distributed to shareholders. $50 million will go to Ofheo, and ultimately to the U.S. Treasury. Fannie Mae does not admit to any wrongdoing under the settlement.