Hearing Opens For Former Freddie CEO

Former Freddie Mac chairman and chief executive Leland C. Brendsel should be held liable for more than $1 billion of costs incurred by the company in connection with a massive restatement of earnings, the government said today at the outset of Brendsel's administrative trial on charges of overseeing elaborate accounting manipulations.

Brendsel knew about and was involved in "unsafe and unsound conduct" and should be held responsible "for placing the financial integrity of Freddie Mac at risk," government lawyer Stephen Hart told the court.

In an opening argument, an attorney for Brendsel, Kevin Downey, said the charges are false and the trial will present a picture of the former executive "acting in good faith" and "trying to do the right thing."

Before the months-long proceeding ends, Brendsel will take the stand, Downey said.

--- David S. Hilzenrath

By Dan Beyers  |  October 15, 2007; 12:16 PM ET  | Category:  Freddie Mac
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