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Suicide of Freddie Mac chief not linked to federal inquiry
Paul Thompson23 Apr 2009
THE suicide of a top banking executive at Freddie Mac is not being linked to an investigation into the mortgage giant's business practices.
Sources at the US Justice Department said David Kellerman was not under any investigation or scrutiny.
The 41-year-old finance chief was found by his wife hanged in the basement of their $1 million home outside Washington in the state of Virginia.
Executives with the struggling Virginia-based company also denied that his death had anything to do with an investigation by the Securities and Exchange Commission.
Freddie Mac, and its sister organisation Fannie Mae, have received more than $50billion in handouts from the US government. The companies were at the centre of the sub-prime mortgage crisis that triggered the collapse of the US banks and other financial institutions.
Mr Kellerman had been appointed acting chief financial officer following a shake-up in the top level of executives at the company.
Friends and neighbours said he had been under "intense pressure" since taking the job last year. He had lost a lot of weight and close friends had advised him to quit the job because of the stress it was causing him as he led a team of 500 in his department. Neighbour Paul Unger said: "He was just a nice guy. You cannot imagine what kind of pressures he must have been under."
Others said Mr Kellerman, who had a five-year-old daughter, worked 14-hour days. "He would leave early in the morning and get back very late at night. He was a company man, but it was taking over his life," said one friend. "He had lost a great deal of weight, and we put it down to the stress of his job."
He had worked for Freddie Mac for the past 16 years, starting out as a financial analyst and auditor, and was due to receive an $850,000 retention bonus over the next year.
Company chiefs have come under fire for agreeing to pay more than $210million in bonuses despite racking up billions in losses on the mortgage market.
Mr Kellerman was named acting chief financial officer last September when the government ousted former CEO Richard Syron and Kellermann's predecessor Anthony Pizsel. He had been working on the company's quarterly financial report, due next month.
Freddie Mac spokesman David Palombi said: "Freddie Mac knows of no connections between this terrible personal tragedy and the ongoing regulatory inquiries discussed in our SEC filings."
