FHFA OIG Looks at Freddie Mac's $1.2B Lehman Brothers Loss

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The Federal Housing Finance Agency (FHFA) Office of Inspector General (OIG) has published an evaluation report detailing Freddie Mac's involvement in unsecured lending to Lehman Brothers just prior to that firm's bankruptcy. The last Freddie Mac loan to that firm resulted in a loss of $1.2 billion . Prior to its filing for bankruptcy Lehman was the fourth largest investment bank in the United States with $639 billion in assets. Lehman traded and underwrote stocks and bonds, traded commodities, was active in the credit derivatives market, and became a major player in both commercial and residential securitization markets . Lehman sold mortgages to Freddie Mac and also served as one of its investment bankers. Lehman underwrote common and preferred stock offerings for Freddie Mac as well as various...(read more)

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Source: http://www.mortgagenewsdaily.com/03142013_oig_freddie_mac_management.asp

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