The Associated Press
Friday, January 12, 2007; 7:57 PM
WASHINGTON -- Kenneth Duberstein, a prominent Republican consultant who has been a director of mortgage giant Fannie Mae since 1998, resigned from the board on Friday, the company announced.
The government-sponsored company, which finances one of every five home loans in the United States, is emerging from a stunning accounting scandal and last month completed a massive restatement of its earnings that erased $6.3 billion in profit for 2001 through mid-2004.
Fannie Mae, in a brief statement, said the company and Duberstein "felt it was important" for him to stay on through the completion of the reworked accounting. It didn't say why Duberstein decided to leave the board. His resignation takes effect on Feb. 15.
Fannie Mae Chairman Stephen Ashley praised Duberstein for his "valuable strategic counsel, leadership and service."
Duberstein, who was President Reagan's White House chief of staff in 1988-89, is one of several prominent political figures and former government officials of both parties who have sat on Fannie Mae's board or held high positions in the company. Its former chief executive, Franklin Raines, was White House budget director in the Clinton administration.
Raines and former chief financial officer Timothy Howard were swept out of office by the Fannie Mae board in December 2004. Federal regulators are seeking civil fines of $100 million or more against Raines, Howard and former controller Leanne Spencer as well as restitution totaling more than $115 million in bonus money tied to an improper accounting scheme.
Attorneys for the three former executives have disputed the regulators' charges and said they were politically motivated.
On the Net:
Fannie Mae: http://www.fanniemae.com