Investors Sue Gov't Over Fannie, Freddie Stock Losses

Law360, New York (July 17, 2013, 3:45 PM ET) -- Private investors in preferred stock issued by Fannie Mae and Freddie Mac on Tuesday filed a class action against the U.S. government alleging that it illegally swept the bailed-out mortgage companies' newfound profits rather than distribute profits to the companies' shareholders.

The complaint filed in the D.C. District Court alleges that the U.S. Department of the Treasury and the Federal Housing Finance Agency improperly amended the preferred stock agreement governing shares in Fannie and Freddie so that any profits they generated went to the government through...
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