Freddie CEO Ignored Warnings, Report Says

Freddie Mac, though, has been resistant and has only picked up $6 billion in a preferred stock deal in 2007. A $5.5 billion stock deal was planned, but because Syron delayed, the cost of raising that money has soared. The stock plunged to all-time lows in mid-July over fears of insolvency, but had recently started to fight its way back as Congress began work on a housing bill.

Freddie Mac on Tuesday afternoon offered a blistering response to the Times story, raising questions about whether the Andrukonis memo ever was put in front of Syron or even exists, saying Andrukonis left the company "involuntarily" and attributing other anonymous charges made in the story to a "well-worn band of ideologues and self-interested detractors who have opposed the GSE model for years."

"Maintaining the right balance between sometimes conflicting demands requires constant vigilance and judgment day in and day out as financial markets go up and down, competitors come and go, opponents attack and innovations drive product and process changes at an ever-increasing pace," the company said in the statement. "But the decisions we made were based on business judgments that were carefully considered based on all of these factors."

Freddie Mac will report its second quarter earnings on Wednesday. Analysts according to Thomson Reuters are forecasting a loss of 53 cents per share. Fannie Mae is expected to report its earnings on Friday and is estimated to report a loss of 69 cents per share.