US - Ohio attorney general Marc Dann has accused Freddie Mac of "intentionally participating in one of the largest housing investment deceptions in modern US economic times", in a lawsuit filed on behalf of the Ohio Public Employees Retirement System (OPERS).
The lawsuit alleges that despite repeated public denials and assurances to the contrary, Freddie Mac was deeply invested in the sub-prime mortgage industry and failed to disclose that it was not protecting itself from the billion-dollar risks it incurred.
In addition to Freddie Mac and its officers, the lawsuit seeks to hold Freddie Mac committee directors personally responsible for their conduct in relation to Freddie Mac's investments and resulting losses in the sub-prime housing mortgage industry.
Dann said: "By authorising me to bring this suit on their behalf [OPERS is] protecting the interests of the pension plan, the workers and retirees who depend upon it, and the taxpayers whose hard-earned dollars fund it."
In addition to initiating the Ohio case, the attorney general filed OPERS' request to become the lead plaintiff in a similar case recently filed in federal court in New York.
OPERS was the lead plaintiff in an earlier case against Freddie Mac and won a $410m settlement in that case.
Freddie Mac declined to comment.
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