Blink and you probably missed it. In yet another classic Friday news dump, Countrywide junk mortgage mogul and Democrat crony Angelo Mozilo copped a $67.5 million plea to avert a high-stakes public trial in the heat of the midterm election season. He and his henchmen admitted no wrongdoing:
Just days before the start of his sensational trial, junk mortgage king Angelo Mozilo agreed to pay $67.5 million to settle fraud charges and avoid any public humiliation in court.
Mozilo, the former CEO of Countrywide Financial, was the highest-ranking executive prosecuted following the financial collapse in 2008 due to toxic mortgage paper. Countrywide was one of the nation’s largest originators of subprime loans.
Mozilo and two of his former executives agreed yesterday in federal court to pay millions in fines and give back some of their ill-gotten gains to settle a suit brought by the Securities and Exchange Commission. Under the settlement, none of them admitted guilt.
Their trial on charges of fraud and insider trading was set to open next week. Mozilo, who wasn’t in the courtroom yesterday, agreed to give up $45 million in ill-gotten profits from illegal trades in Countrywide stock ahead of its collapse, and pay a record $22.5 million civil penalty.His ex-CFO at the firm, Eric P. Sieracki, got off with only a civil penalty of $130,000.
Former President David Sambol will give back $5 million in ill-gotten trading profits and pay a $520,000 civil penalty to settle his charges.
Guess who’s pitching in a nice chuck of the settlement?
Thanks to bailed out Bank of America, taxpayers are on the hook for $50 million: “Both of the restitution payments — $45 million from Mozilo and $5 million from Sambol — will be paid on their behalf by Bank of America, which bought Countrywide after its 2008 collapse over junk assets.”
Connecticut GOP Senate candidate Linda McMahon, citing a Nation investigative report on the smelly deal, is zeroing in on Democrat CT Attorney General Dick Blumenthal’s role in abetting the Democrat culture of corruption:
The McMahon campaign is slamming Blumenthal not only for helping put together a settlement that Bank of America has been able to evade in spirit, if not as a matter of law, but also because he continued to defend the settlement as the best recourse for homeowners, even after complaints emerged and other attorneys general had stopped boasting about the deal.
Dan Collins points out that the fine is chump change in comparison to Mozilo’s estimated $600 million net worth.
While Obama travels the country tarring the GOP as the party of the rich, he’s had precious little to say about fat cat Mozilo’s slap on the wrist and the Democrat beneficiaries of Mozilo’s largesse — from Dodd and Conrad to Jim Johnson and scores of Fannie Mae employees.
The GOP must continue to hammer the Countrywide/Fannie Mae scandal…before the Democrats succeed in manufacturing another subprime crisis and massive taxpayer bailout again.
Like I say: It’s all about the boodle.
Flashback: Obama and Dodd – Corrupt birds of a feather
The Republican party will launch aggressive inquiries into alleged abuse of mortgages for low-income buyers if it takes control of the House of Representatives next month.
Darrell Issa, who would head the lower chamber’s main investigative committee, told the Financial Times in an interview: “We should look at financial entities and either reform them or kill them.”
The conservative Republican from California, who would become chairman of the powerful House oversight and government reform committee, said hearings would focus on whether the federal government should be involved at all in sponsoring home loans for the poor.
The investigations would centre on the roles of Fannie Mae and Freddie Mac, the nationalised government-sponsored lending institutions, which Republicans say contributed strongly to the 2008 meltdown by promoting subprime lending.
Mr Issa said the role of Countrywide, the bankrupt subprime lender, would also be investigated. He did not spell out whether he would investigate alleged connections between subprime lenders and Democratic politicians.