Changes

==Fraudulent accounting 1990s - 2006==

==Fraudulent accounting 1990s - 2006==

Accounting problems at Fannie Mae first surfaced in 2003, and led to investigations by the [[Securities and Exchange Commission]] and [[U.S Justice Department]]. Regulators found a culture of corruption where management overstated earnings by $11 billion beginning in the [[Clinton era]] and reaped huge bonuses for themselves.<ref>[http://articles.chicagotribune.com/2006-05-24/business/0605240197_1_senior-management-manipulated-accounting-fannie-mae-executive-officer-franklin-raines `Arrogant and unethical': Fannie Mae to pay $400 million penalty,] Robert Manor, ''Chicago Tribune'', May 24, 2006.</ref> As Fannie Mae was taken into conservatorship in September 2008 it was reported [[Barack Obama]] received more than $126,000 in contributions from the [[government sponsored entity]], more than any other political candidate for office since 1989.<ref>[http://www.opensecrets.org/news/2008/09/update-fannie-mae-and-freddie.html Update: Fannie Mae and Freddie Mac Invest in Lawmakers], By Lindsay Renick Mayer, September 11, 2008. opensecrets.org</ref>

Accounting problems at Fannie Mae first surfaced in 2003, and led to investigations by the [[Securities and Exchange Commission]] and [[U.S Justice Department]]. Regulators found a culture of corruption where management overstated earnings by $11 billion beginning in the [[Bill Clinton|Clinton era]]<ref>Bill Clinton appointed [[Rahm Emanuel]], later [[Obama]] [[Chief of Staff]], to the Board of Directors of Fannie Mae's sister agency, Freddie Mac. Emanuel had no experience of qualifications for the position. Freddie Mac likewise was taken into conservatorship for mismanagement.</ref> and reaped huge bonuses for themselves<ref>[http://articles.chicagotribune.com/2006-05-24/business/0605240197_1_senior-management-manipulated-accounting-fannie-mae-executive-officer-franklin-raines `Arrogant and unethical': Fannie Mae to pay $400 million penalty,] Robert Manor, ''Chicago Tribune'', May 24, 2006.</ref> As Fannie Mae was taken into conservatorship in September 2008 it was reported [[Barack Obama]] received more than $126,000 in contributions from the [[government sponsored entity]], more than any other political candidate for office since 1989.<ref>[http://www.opensecrets.org/news/2008/09/update-fannie-mae-and-freddie.html Update: Fannie Mae and Freddie Mac Invest in Lawmakers], By Lindsay Renick Mayer, September 11, 2008. opensecrets.org</ref>

Auditors stated,

Auditors stated,

{{CquoteThe image of Fannie Mae as one of the lowest-risk and `best in class' institutions was a facade...Our examination found an environment where the ends justified the means. Senior management manipulated accounting, reaped maximum, undeserved bonuses, and prevented the rest of the world from knowing.}}

{{Cquote|The image of Fannie Mae as one of the lowest-risk and `best in class' institutions was a facade...Our examination found an environment where the ends justified the means. Senior management manipulated accounting, reaped maximum, undeserved bonuses, and prevented the rest of the world from knowing.}}

The auditor's report stated executives moved profits from one year to the next to assure they would meet company goals to receive undeserved bonuses and accused Fannie Mae of taking large and sometimes unprofitable risks that were not revealed to investors. The report issued in 2006 was only the beginning of the revelations that shook the world.

The auditor's report stated executives moved profits from one year to the next to assure they would meet company goals to receive undeserved bonuses and accused Fannie Mae of taking large and sometimes unprofitable risks that were not revealed to investors. The report issued in 2006 was only the beginning of the revelations that shook the world.