Freddie Mac Conducts Internal Probe Into Lobbying Campaign -AP

A group of lawyers hired by Freddie Mac (FRE) is quietly conducting an investigation into the firm's own lobbying campaign, an effort that helped quash proposed new regulations before the collapse of the housing market, The Associated Press reported on Monday.

A Washington law firm, Covington & Burling LLP, has spent more than a month interviewing current and former Freddie Mac executives and employees, the AP said, citing three people familiar with the matter. Former Justice Dept prosecutor Stephen Anthony is leading the investigation.

Previously, the AP reported that $2 million was paid to a lobbying firm, DCI Group of Washington, to target 17 Republican senators to defeat a 2005 bill sponsored by Sen. Check Hagel, R-Neb., that would have forced Freddie Mac to sell hundreds of billions from its then-lucrative mortgage and mortgage-backed securities portfolios.

Also under review: an accounting of six-figure payments to 52 outside lobbying groups and political consultants in 2006, including firms with links to former Sen. Al D'Amato of New York and former House Speaker Newt Gingrich of Georgia.

Freddie Mac board chairman John Koskinen confirmed that an inquiry is under way but declined further comment.

Full story at http://www.google.com/hostednews/ap/article/ALeqM5inqieurDHqfP-cj7cUwybkA_ZLlwD96H5JS80

-Dow Jones Newswires; 201-938-5500