, stung twice in two months by CEOs regulators viewed as being too close to its fishy accounting, Sunday hired a new chief executive whose closeness with regulators goes back two decades.
The mortgage merchant named 60-year-old Richard Syron chairman and chief executive, effective before the end of the year. Syron will take over for Greg Parseghian, whom the government asked to leave the company in late August amid a scandal that last month led to a $5 billion earnings restatement dating to 2000.
Parseghian himself was brought in to clean house after the accounting problems first came to light, succeeding then-CEO Leland Brendsel in June. Brendsel headed the government-chartered Freddie during the period of the accounting problems, which involved the mistreatment of derivatives the company uses to hedge the value of its massive book of mortgages and mortgage bonds.
Syron is currently executive chairman of
but it is in regulation that he made his professional name. From 1984 to 1986 he was president of Federal Home Loan Bank of Boston, an enterprise that like Freddie tries to promote mortgage lending through various financial strategies that benefit from the perceived support of the U.S. government. He was president of the Federal Reserve Bank of Boston from 1989 to 1994 and chairman of the American Stock Exchange from 1994 to 1999.
Two of Syron's past postings involved large measures of corporate remediation. Thermo Electron had a Byzantine subsidiary structure before Syron took over, sold many of its units off and helped revive the moribund shares. And New England's banking system was close to ruin when Syron arrived at the Boston Fed and helped save several large institutions that could have failed.
Shaun F. O'Malley, Freddie's current chairman, will become lead director of the board, while George D. Gould will remain chairman of the board's governance committee. O'Malley said in a statement that Syron was the board's first and only choice to become chairman and chief executive.
Syron was quoted saying "there is much yet to be done to earn the full confidence of the public and all our stakeholders.
"I am encouraged that the company has completed its restatement of prior years' results, instituted a remediation program and, throughout, has maintained its safety and soundness and strong economic base. I am very confident of Freddie Mac's future."