Fannie Mae wins dismissal of much of investor suit

Reuters reports:

A federal judge dismissed most of a lawsuit accusing Fannie Mae and former executives of misleading investors about its mortgage exposure and risk management before being seized by regulators in 2008.

U.S. District Judge Paul Crotty in Manhattan dismissed allegations against all defendants regarding the mortgage financier's subprime and "Alt-A" mortgage exposure, and deficiencies in its financial reporting.

The judge refused to dismiss allegations regarding Fannie Mae's risk management as to former Chief Executive Daniel Mudd and former Chief Risk Officer Enrico Dallavecchia, citing emails that said they "had personal knowledge of Fannie's allegedly inadequate internal risk controls."

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