Ohio Attorney General sues Fannie Mae.

• Position: Ohio

Ohio Attorney General Jim Petro has filed a lawsuit on behalf of the state of Ohio alleging that Fannie Mae deceived investors by failing to disclose that it did not follow GAAP.

The securities fraud class action lawsuit, initiated by Ohio on behalf of all Fannie Mae shareholders, accuses the government sponsored lender of manipulating earnings to deceive investors, while the company's executives profited from inflated stock prices.

The complaint alleges that Fannie Mae and its top executives:

* Violated the Securities Exchange Act and SEC rules.

* Failed to disclose that the company did not apply GAAP.

* Lacked sufficient internal auditing controls.

* Failed to report the volatility of the company's...