DeWine announced the settlement in a news release (found online at ohioattorneygeneral.gov; 5/7/13), noting that the class-action lawsuit against Fannie Mae and KPMG alleged the firms, along with others, issued false and misleading financial reports to shareholders, which artificially inflated the value of Fannie Mae’s securities. Among the plaintiffs in the suit were the Ohio Public Employees Retirement System (OPERS) and the State Teachers Retirement System of Ohio (STRS), along with purchasers of Fannie Mae common stock and call options, and sellers of Fannie Mae put options from April 17, 2001 through December 22, 2004.
“I am pleased to see this litigation finally resolved on behalf of the Ohio pension funds and other members of this very large class,” said Attorney General DeWine. “The settlement brings closure to this matter and recovery for our Ohio pension funds and class members.”
READ MORE EMPLOYEE STOCK OPTION LEGAL NEWS
In September 2012, Franklin Raines, former chairman of Fannie Mae, was dismissed from the securities fraud lawsuit, with the judge finding that plaintiffs could not prove Raines intended to deceive them or that he failed to meet the standard of ordinary care in his reporting on the company’s financial status. Shortly after that, Leanne G. Spencer, who is a former controller of Fannie Mae, was also dismissed from the lawsuit.
The lawsuit is Federal National Mortgage Association Securities, Derivative and “ERISA” Litigation, 04-cv-01639, US District Court, District of Columbia (Washington).