The Related Companies has been served with a subpoena as part of a federal inspector general’s investigation of a transaction the company did with Fannie Mae that allowed Related to invest a stake in several apartment buildings that had been foreclosed upon by Fannie, according to the Wall Street Journal. Related retained Kenneth Breen, a New York-based litigator at international law firm Paul Hastings, in the case.
As previously reported, the inspector general began a limited investigation into Fannie Mae in October; the agency responded by putting employees on leave until the investigation is completed.
“The investigation is limited in scope and we are cooperating fully,” a Fannie spokesperson commented.
One of the most senior executives being looked at by investigators is David Worley, a Fannie senior vice president, chief risk officer for the multi-family business unit. [WSJ]