Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Troubled Freddie Mac Hires New Chairman

WASHINGTON -- Home mortgage financer Freddie Mac, trying to regain investor confidence after an accounting scandal, on Sunday named former American Stock Exchange chief executive Richard Syron as its chairman and chief executive.

Syron's mortgage industry expertise, corporate leadership background and public policy experience made him the top pick of Freddie Mac's board, Chairman Shaun O'Malley said.

Syron, 60, had been serving as executive chairman of advanced technology instrument company Thermo Electron Corp., after stepping down as chief executive last year. He also had been chief executive of the Federal Reserve Bank of Boston and the Federal Home Loan Bank of Boston.

He replaces Gregory Parseghian at Freddie Mac, the No. 2 source of U.S. home financing, which last month restated three years of earnings upward by $5 billion. It has delayed release of its 2003 earnings until the middle of 2004.

"We all realize there is much yet to be done to earn the full confidence of the public and all our stakeholders," Syron said in statement.

O'Malley said the board consulted during the CEO search process with the Office of Federal Housing Enterprise Oversight, Freddie Mac's regulator. The regulator approved the company's choice, a spokeswoman for the agency said.

Freddie Mac, a government-sponsored company, replaced five senior executives in the summer -- including CEO Leland Brendsel in June -- because of accounting improprieties linked with the restatement, roiling financial markets.

Parseghian, the former chief investment officer, was the company's choice in June to take over as CEO. He was asked to leave at the end of August under pressure from regulators because of his ties to transactions used to smooth earnings volatility.

The company faces investigations by the Securities and Exchange Commission and a federal prosecutor in Northern Virginia. Its financial regulator is also expected to issue a tough report as soon as this week, possibly including financial penalties.

Lawmakers and the Bush administration also want to tighten government oversight of Freddie Mac and its cousin government-sponsored mortgage finance enterprise, Fannie Mae FNM.N. As of earlier this year, the companies together had guaranteed or financed 45 percent of the $7.2 trillion U.S. mortgage debt outstanding.

Analysts said Syron's test would be how quickly he could put Freddie Mac back on track after the restatement and executive suite upheaval.