Freddie Mac executive committed suicide
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Freddie Mac executive committed suicide
By Deborah Charles
RESTON, Virginia (Reuters) - David Kellermann, acting chief financial officer of troubled U.S. mortgage giant Freddie Mac, was found dead on Wednesday in his suburban Virginia home after apparently committing suicide, a local police source said.
Kellermann, 41, was named Freddie Mac's acting CFO last September after the Treasury Department seized the company, and its sibling mortgage agency Fannie Mae, as the agencies faced deep losses on a crashing U.S. housing market that was rapidly engulfing other financial institutions.
A police source said that Kellermann was found hanging in the basement of his home in Reston, outside Washington.
A 16-year veteran of Freddie Mac, Kellermann had played a key role in helping the firm navigate accounting scandals and answer questions from regulators and investors who put the company under intense scrutiny as the U.S. housing market ended a five-year boom in 2006.
Police officials in Fairfax County would not confirm the death was a suicide but said police were called at 4:48 a.m. EDT (8:48 GMT) to his home.
"Officers arrived and were directed to the basement of the home where they found David Kellermann dead," said Eddy Azcarate, a spokesman for Fairfax County Police.
"We are not speculating as to the manner and cause of death. We're going to wait for the medical examiner to give that information," he said. "The body has been taken to the medical examiner's office. We do not suspect foul play."
He said police never discuss if any notes are found.
SEC PROBE.
In March, Freddie Mac said that it was cooperating with the Securities and Exchange Commission in an investigation and that employees have been interviewed by investigators.
There was no indication what caused Kellermann to commit suicide.
While Freddie Mac has seen its executive ranks churn since accounting improprieties first emerged in 2003 and as it has booked multi-billion dollar losses in recent quarters, those who knew Kellermann spoke of his good character and dedication to the job.
"For many years, we have known David as a person of the utmost ethical standards who was hardworking and knowledgeable in his field," the Federal Housing Finance Board, Freddie Mac's chief regulator, said in a statement.
Freddie Mac and Fannie Mae, known as government-sponsored enterprises, had a hand in about half of the entire U.S. mortgage market and were taken over in an effort to ward off further damage to the U.S. housing market.
Colleagues and former co-workers were shocked at the news of Kellermann's death.
"He was a smart guy who had risen fast. And people liked being around him. That's not something you could say about everyone there," said a former Freddie Mac executive who knew Kellermann.
Kellermann had been closely involved in many key accounting and financial issues since 2003 when regulators found that Freddie Mac had improperly booked years of losses.
HOMELESS CHARITY
Before taking over as acting CFO, he served as senior vice president, corporate controller and principal accounting officer.
He volunteered in the community with a charity for the homeless.
Police spokesman Azcarate said Kellermann's family was still in the house, and "they are surrounding themselves with additional family and friends."
Kellermann died in a sprawling red brick house in quiet wealthy upscale neighbourhood called "Hunter Mill Estates."
The New York Times said that according to neighbours and company officials, Kellermann had received a bonus of about $800,000. Such bonuses -- which totalled $210 million for executives at Freddie Mac and its sibling company Fannie Mae -- prompted scrutiny from lawmakers who have questioned bonuses for executives of firms receiving government bailouts.
The Times said that Kellermann hired a private security firm after reporters came to his house to ask about his bonus.
HIGH-PROFILE SUICIDES
There have been several high-profile suicides in the global financial crisis in the past six months.
German billionaire businessman Adolf Merckle threw himself in front of a train in January after heavy losses on the stock market.
Merckle's business empire included major cement and drug companies but was hobbled by debt and effectively controlled by the banks that lent it money after a series of wrong-way bets on stock investments.
In December, Frenchman Thierry Magon de la Villehuchet, 65, co-founder of money manager Access International, was found dead in a New York office building, reportedly distraught over losing up to $1.4 billion in client money to Bernard Madoff's fraud. He slit his wrists with boxcutters.
(Additional reporting by Patrick Rucker in Washington and Walden Siew in New York; Editing by Frances Kerry)
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Sad case...