Policy intended to avoid violations during restatement process
By MortgageDaily.com staff
5/5/2005

Fannie Mae employees have been banned from trading shares of the company's stock, according to a story in the Washington Post today.

The new policy comes as the company works to restate its financials.

The company reportedly sent out an e-mail to its 5,000 employees Friday announcing the trading blackout for the foreseeable future and citing its "inability to make public filings with the Securities and Exchange Commission, the increasing number of employees supporting our restatement effort, and the continuing progress of internal and external reviews and investigations" as a rationale for the ban.

Workers were told the move will help protect them from inadvertently violating securities laws, the Post said, because they may be aware of information not widely available to the market.

The policy reportedly applies to all employees.

Freddie made a similar move during 2003, according to the article, while it was unable to file audited statements.

The e-mail also instructed employees to "cancel any outstanding instructions you have given your broker to purchase or sell shares in the future," the Post said.

Fannie reportedly told the news publication that a few employees have contacted company officials with hardship requests.

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