Freddie Mac Faces New Suit Over Subprime Practices

Law360, New York (August 18, 2008, 12:00 AM EDT) -- After months of growing speculation over its fate, government-chartered mortgage buyer Freddie Mac has been hit with another proposed class action for allegedly concealing its exposure to the subprime mortgage crisis.

The complaint, filed Friday in the U.S. District Court for the Southern District of New York, accuses the home loan giant and several of its executives of having known since 2004 about the problems with Freddie Mac's involvement with risky loans and underwriting standards.

On Nov. 20, 2007, Freddie Mac revealed that $150 billion of...
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