Freddie Mac Says It Understated 2002 Profits by Billions

The nation's second-largest financier of mortgages said it understated its operating profits last year by as much as $6.9 billion, increasing the volatility of its future earnings. By Alex Berenson.

[New York Times: NYT HomePage]

D. Remer of Poliitcal News & Analysis comments: The first step to successful embezzlement is to hide some of the profits. While this article does not lay any claim or speculation in this direction, there is a bigger story here, than Freddie Mac stipulating it was just holding those billions back to pad future years when earnings would be lower. Plausible statement. But, in light of Anderson Accounting Firm's involvement, it seems greater scrutiny is required here. It must be remebered that the tax payers are vulnerable to picking up the tab for fraud and abuse at Freddie Mac, and the public should demand a more detailed investigation.