Watchdog: Fannie, Freddie may have lost over $3B

Published on NewsOK Modified: December 19, 2012 at 6:18 pm •  Published: December 19, 2012

Legal action against banks by the FHFA on Fannie and Freddie's behalf would add to a flurry of lawsuits filed by cities and municipal agencies in the U.S. against some of the banks that set the LIBOR rate. The cities and agencies are seeking damages for losses they say they suffered as a result of an artificially low rate, because they hold bonds and other investments whose value is pegged to LIBOR.

The FHFA said in a statement Wednesday that it hasn't determined specific losses from LIBOR for the two companies and hasn't decided whether to pursue legal action against the banks.

"We continue to evaluate issues associated with LIBOR and monitor LIBOR-related developments," the agency's statement said.

Spokesmen for Fannie and Freddie declined to comment.

The LIBOR scandal is likely to make headlines again in coming weeks and months. Other big global banks in several countries also are being investigated for rigging the rate and are expected to be fined.