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Report: Fannie Mae Overpays Servicers By $89M

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WASHINGTON (9/20/13)--Fannie Mae overpaid its servicers by about $89 million in 2012 because a manual review by a third-party vendor resulted in accounting errors, according to an inspector general's report issued Wednesday.
 
Fannie also incorrectly denied $27 million in reimbursements last year, said the Office of the Inspector General (IG) for the Federal Housing Finance Agency (National Mortgage News Sept. 19).
 
The IG's office blamed erroneous reviews by auditing firm Accenture for the overpayment.
 
However, the FHFA is conducting its own review and has disagreed with the methodology used by the IG. FHFA said payment errors' total was "substantially less" than what was reported by the IG. FHFA did not provide an estimate of the alternative amount, said National Mortgage News.
 
Errors generally happen when there are limited reviews, inconsistency in applying guidelines, complexity or a big amount of servicer claims, the publication said.

Jobless Claims Remain Near Six-year Low

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WASHINGTON (9/20/13)--Initial claims for U.S. unemployment benefits last week remained near a six-year low, although tallies may be skewed because of ongoing reporting irregularities caused by computer-system conversion problems in California and Nevada (The Wall Street Journal, Bloomberg.com and Moody's Economy.com Sept. 19).
 
Claims rose 15,000--to 309,000--for the week ended Sept. 14 from one week earlier, the Labor Department said Thursday. Economists had forecast an increase to 330,000, according to a Bloomberg survey.  
 
Fewer job cuts going forward could pave the way for bigger job gains in hiring and an expansion of consumer spending, which constitutes 70% of the U.S. economy, Bloomberg said.
 
The labor market is definitely improving, meaning initial jobless claims appear to be influenced by more than just processing problems, Brian Jones, senior U.S. economist at Societe Generale in New York, told Bloomberg.
 
Meanwhile, continuing claims for unemployment benefits dropped 28,000 for the week ended Sept. 7--a 481,000 decline year over year.