WASHINGTON – A former CEO and two former top executives at mortgage giant Freddie Mac have settled a government lawsuit. They were accused of understating the amounts of high-risk mortgages that Freddie held just before the housing bubble burst in 2007.
Continue Reading Below
The Securities and Exchange Commission announced the settlement late Tuesday with former Freddie CEO Richard Syron; Patricia Cook, an executive vice president and chief business officer; and Donald Bisenius, a senior vice president.
They agreed to donations to a fund for Freddie investors of $250,000 for Syron, $50,000 for Cook and $10,000 for Bisenius.
The government rescued Freddie and larger sibling Fannie Mae in 2008 as they neared collapse after incurring massive losses on risky mortgages. Taxpayers spent about $187 billion to rescue the two companies, including $71 billion for Freddie.