Housing Bubble

Freddie Mac provides SEC update

June 11, 2003

MCLEAN, Va., -- Freddie Mac today announced that it has been informed by the staff of the Securities and Exchange Commission (SEC) that the SEC has commenced a formal investigation. By doing this, the SEC is able to issue subpoenas for witnesses and documents, particularly from third parties outside the corporation.

Shaun O'Malley, Chairman of the Board of Directors, stated, "Since January of this year, the Board of Directors has ordered full cooperation with the SEC's informal inquiry. We will continue to cooperate in all respects as the investigation continues. The Board of Directors is continuing to supervise closely the company's evaluation of all matters related to the restatement. Our Audit Committee counsel's active review, as of this date, does not indicate that any employee of Freddie Mac other than Mr. Glenn has engaged in conduct of the kind we disclosed on Monday. We can also confirm that the conduct we disclosed on Monday related to Mr. Glenn's diaries and not to the company's accounting records."

Source: Freddie Mac