Questions (and few answers) after Freddie CFO suicide
David Kellermann, acting chief financial officer of troubled U.S. mortgage giant Freddie Mac, was found dead in his suburban Virginia home after apparently committing suicide.
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.
The death of Freddie’s acting finance chief follows several high-profile suicides that have been linked to the global financial collapse. German billionaire businessman Adolf Merckle threw himself in front of a train in January after heavy losses on the stock market. 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.
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.
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.
“Freddie Mac knows of no connections between this terrible personal tragedy and the ongoing regulatory inquiries discussed in our SEC filings,” said David Palombi, the executive communications officer for the mortgage finance company.
Attorney General Eric Holder said he had no idea whether the apparent suicide of a senior official at Freddie Mac was related to investigations of the troubled mortgage giant.
Bonuses and private security
According to the neighbors and company officials who spoke to the New York Times, Kellermann had received a bonus of about $800,000 a few weeks back, on the heels of a public outcry over executive compensation. According to neighbors, Kellermann hired a private security firm after reporters approached his house to ask about his bonus.
The question behind every suicide and the hardest one to answer. While details remain sketchy as to the reason behind Kellermann’s death, Charlie Gasparino at the Daily Beast writes that his death is seemingly a tragic trend that “underscores the tragic personal cost of the financial meltdown.”
While the pressure of his job and the deep impact of the crisis may be an obvious motive, Megan McArdle from The Atlantic writes that “you don’t commit suicide because you’re mad at regulators. You commit suicide because you have deep mental health issues.”