Mudd, who was ousted from Fannie Mae in 2008 and is now chief executive of hedge fund Fortress Investment Group LLC , confirmed he received a so-called Wells notice on Friday from the US Securities and Exchange Commission, and said he plans to rebut the allegations, Bloomberg said.

A Wells Notice is a letter from the SEC that warns people or firms the agency is considering a civil action against them.

Mudd could not immediately be reached for comment.