Fannie Mae has more trouble

WASHINGTON -- Federal regulators investigating the accounting of embattled Fannie Mae have discovered additional serious problems, the mortgage giant disclosed Wednesday, as it received a three-month extension for boosting its capital cushion against risk.

The biggest U.S. buyer of home mortgages has been reducing its portfolio of home loans even faster than expected as it prepared to meet the regulators' original June deadline for a $5 billion capital boost.

An eight-month investigation by the Office of Federal Housing Enterprise Oversight, which supervises Fannie Mae, last year found serious accounting problems at the government-sponsored company as well as a pervasive pattern of earnings manipulation and lax internal controls.