Fannie Mae, which faces a possible $9 billion restatement, is also looking at yet another investigation and the possibility of a management shake-up at the top.

The Wall Street Journal reported that Fannie Mae's board of directors met most of Sunday to discuss whether changing top executives would give the mortgage finance giant a “fresh start” with regulators.

The company did not issue a statement about the meeting and a company spokesman declined comment, the newspaper reported.

Fannie Mae is already being investigated by the Justice Department and the Securities and Exchange Commission, which announced on Wednesday that two accounting standards were violated between 2001 and the middle of this year. Now, the Public Company Accounting Oversight Board will investigate whether auditing rules were violated by KPMG, which signed off on the statements during that period, the Financial Times of London reported.

KPMG stated on Thursday that it considered the SEC the “final arbiter” of generally accepted accounting principles, or GAAP, adding that Chief Accountant Donald Nicolaisen had determined that the way Fannie accounted for derivatives transactions did not comply with GAAP.

Fannie Mae said it will restate its accounts, and top executives are required under Sarbanes-Oxley to certify the statements are accurate. A central question is whether Chief Executive Franklin Raines and Timothy Howard, chief financial officer, knew they were misrepresenting the company's finances when the accounts were certified.

The Journal, citing one person familiar with the situation, said Raines contends he should not be dismissed because he relied on auditors' advice and did not act in bad faith.

However, some advisers are telling the board that it has to deal with the perception that Raines is part of the problem, whatever the reality, the Journal reported.

When Freddie Mac faced a similar accounting scandal last year, most of its top executives were ousted. Government-chartered Fannie Mae and Freddie Mac own or guarantee almost half the $7.6 trillion mortgage market.