Friday, June 5, 2009

Thursday, June 4, 2009

"Friends of Angelo" VIP program

In June 2008 Conde Nast Portfolio reported that several influential lawmakers and politicians, including Senate Banking Committee Chairman Christopher Dodd, Senate Finance Committee Chairman Kent Conrad, and Fannie Mae former CEO Jim Johnson, received favorable mortgage financing from Countrywide by virtue of being "Friends of Angelo."

Senator Dodd received a $75,000 reduction in mortgage payments from Countrywide at allegedly below-market rates on his Washington, D.C. and Connecticut homes. Dodd nonetheless called for stronger regulation of mortgage lenders and proposed that predatory lenders should face criminal charges.

Clinton Jones III, senior counsel of the House Financial Services Subcommittee on Housing and Community Opportunity, and "an adviser to ranking Republican members of Congress responsible for legislation of interest to the financial services industry and of importance to Countrywide." was given special treatment. Jones is now state director for federal residential-mortgage bundler Freddie Mac. Alphonso Jackson, acting secretary of HUD at the time and long time friend and Texas neighbor of President Bush, received a discounted mortgage for himself and sought one for his daughter. "In 2003, using V.I.P. loans for nearly $1 million apiece, Franklin Raines, Fannie Mae’s chairman and C.E.O. from 1999 to 2004, twice refinanced his seven-bedroom home, which has a pool and movie theater."

E-mail Controversy

In May 2008, Mozilo made the news by accidentally hitting "reply" instead of "forward" in response to an e-mail from a distressed homeowner named Daniel Bailey of North Carolina. Mr. Bailey had created a hardship letter to request a loan modification from Mr. Mozilo on a website forum named Mr. Bailey then sent his request directly to the Office of the President of Countrywide and this was Angelo Mozilo's reply.

"This is unbelievable. Most of these letters now have the same wording. Obviously they are being counseled by some other person or by the internet. Disgusting."


Mozilo's compensation during the United States housing bubble of 2001–06 has come under scrutiny. During that period, his total compensation (including salary, bonuses, options and restricted stock) approached $470 million.

His compensation also includes payment of his annual country club dues at Sherwood Country Club in Thousand Oaks, CA, The Quarry at La Quinta golf club in La Quinta, CA and Robert Trent Jones Golf Club in Gainesville, VA.

Shortly after University of San Diego invited Mozilo to be the keynote speaker a conference for "sustainable real estate," was created in protest on January 10, 2008. Mozilo pulled out six days later. Shortly after that, Congress invited Mozilo to testify about his compensation.

Mozilo testified before the United States House Committee on Oversight and Government Reform on March 7, 2008, calling reports of their pay "grossly exaggerated" in some instances and pointing out that they lost millions as well. He defended the pay: The compensation was a function of how the company did ahead of the mortgage crisis.

Insider Sales

Over many years, Mozilo sold hundreds of millions of dollars in stock personally, even while publicly touting the stock and using shareholder funds to buy back stock to support the share price. On June 4, 2009, the U.S. Securities and Exchange Commission charged former CEO Angelo Mozilo with insider trading and securities fraud

Angelo R. Mozilo is the son of a Bronx butcher. He received a Bachelor of Science degree from Fordham University in 1960 and holds an honorary Doctor of Laws degree from Pepperdine University.

In 1978 he and his former mentor David S. Loeb, who had already started a mortgage lending company, founded Countrywide Credit Industries in New York. They later moved the headquarters to Calabasas, California in Los Angeles County. Mozilo and Loeb also cofounded IndyMac Bank, which was founded as Countrywide Mortgage Investment, before being spun off as an independent bank in 1997. IndyMac collapsed and was seized by federal regulators on July 11, 2008.

Since Countrywide was listed on the NYSE in 1984, Mozilo has sold $406 million worth of its stock, mostly obtained through stock option grants. $129 million of this was realized in the 12 months ending August 2007.

Perhaps more than any single individual, Mozilo has come to symbolize, and bear the blame for, the subprime mortgage crisis. In a New York Times feature on October 20, 2008, Henry G. Cisneros, a former HUD chairman and member of the Countrywide board of directors, describes Mr. Mozilo as “sick with stress — the final chapter of his life is the infamy that’s been brought on him, or that he brought on himself.” CNN named Mozilo as one of the "Ten Most Wanted: Culprits" of the 2008 financial collapse in the United States.

Angelo Mozilo

Angelo R. Mozilo
(born 1938 in New York City) was the chairman of the board and chief executive officer of Countrywide Financial until July 1, 2008. CNBC named Mozilo as one of the "Worst American CEOs of All Time".