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This excerpt taken from the C 8-K filed Oct 13, 2009. Freddie Mac. Citigroup Global Markets Inc., along with a number
of other financial institutions, has been named as a defendant in two lawsuits
pending in the United States District Court for the Southern District of New
York brought by Freddie Mac shareholders who purchased preferred shares
traceable to a November 2007 offering of Z Preferred Shares. Plaintiffs
allege violations of Section 12(a)(2) of the Securities Act of 1933
and Section 10(b) of the Securities Exchange Act of 1934 because the
offering materials failed to disclose
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Freddie Mac’s exposure to mortgage-related losses, poor underwriting procedures and risk management, and the resulting negative impact to Freddie’s capital.
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