Former Fannie Mae CEO Dan Mudd Steps Down As CEO Of Fortress Investment Group

daniel mudd
Daniel Mudd

[credit provider=”AP”]

Fortress Investment Group’s CEO Daniel Mudd will take a leave of absence from the helm, the company announced this morning. [via Bloomberg Television]”I have requested a leave of absence from my position as chief executive officer to ensure that any time or attention I need to focus on matters outside of Fortress will not affect the business or operations of the company,” Mudd said in a statement.

In the meantime, Randal Nardone, Fortress principal and co-founder, will serve as interim CEO, effective immediately, the publicly traded investment firm said in a release.

Last Friday, the Securities and Exchange Commission announced it is suing Fortress Investment Group’s Mudd in a lawsuit involving his role as CEO of Fannie Mae along with other top former Fannie and Freddie execs.

The SEC’s civil suits allege that Mudd and other Fannie and Freddie execs made false and misleading credit risk disclosures regarding risky mortgage loans.

Mudd has denied the SEC’s allegations. 

“The SEC is wrong, and I look forward to a court where fairness and reason — not politics — is the standard for justice,” Mudd said on Friday.

Shortly after the SEC’s suit, there was news that the FBI was getting involved.

The FBI has reportedly launched an investigation into whether Mudd and other former Fannie and Freddie execs misled investors and the public about subprime loans prior to the 2008 financial crisis, The Daily’s Josh Bernstein and Andrew Strickler reported.

While the SEC’s lawsuit and the FBI’s probe against Mudd did not involve his current role at the publicly-traded investment management firm, there was much speculation that it would be difficult for him to remain CEO of Fortress while he deals with these outside matters.

Shares of Fortress Investment Group were last down more than 2% in pre-market trading.