Fannie Mae to spend $1 billion on review

Fannie Mae said it expected to spend more than $1 billion this year on the massive review of its accounting and preparing financial statements as the mortgage giant pushed to complete it by year-end.

The government-sponsored company, which finances one of every five home loans in the U.S., is emerging from an accounting scandal that brought the ouster of top executives and a record $400-million civil fine in a settlement with federal regulators. Fannie Mae also said it would miss a regulatory deadline for filing its financial report for the third quarter of 2006. The company hasn’t filed an earnings statement since late 2004.