FHFA Serves Related Cos. with Subpoena

New York developer ""Related Cos"":www.related.com/. has been served. The company received a subpoena from the inspector general of the ""Federal Housing Finance Agency"":www.fhfa.gov/, as part of its investigation into business transactions between the entity and ""Fannie Mae"":www.fanniemae.com/.

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In early 2011, Related entered into a joint venture with the GSE, and through the deal, Related gained an investment stake in multiple apartment properties that were in foreclosure via Fannie. The subpoena focuses on the issue of employment

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opportunities that may have been discussed between the companies, though spokespeople for Related told the _Wall Street Journal_ that the joint project posses no employees.

Additionally, emails obtained by the paper indicate that the FHFA's legal pursuit is only targeting a portion of the transaction. A spokesperson for Fannie went on record with the _Wall Street Journal_, stating that, ""The investigation is limited in scope and we are cooperating fully.""

Rumors are rife around the case, and one of the most widely reported aspects of the investigation is the alleged examination of David S. Worley III, who is a senior vice president for Fannie as well as its chief risk officer for the company's multifamily unit.

Worley's attorney, Brendan Sullivan, spoke to the _Wall Street Journal_, saying, ""Our hope is that we can quickly demonstrate that there is no basis to proceed with this investigation.""

Related is currently represented by litigator Kenneth Breen of New York-based firm, ""Paul Hastings"":www.paulhastings.com/. The paper also notes that officials from the ""U.S. Attorney's Office for the Eastern District of Virginia"":www.justice.gov/usao/vae/ are involved in the case.