Countrywide Mortgage Devastation Lingers as Ex-Chief Moves On

NY Times ^ | June 24, 2016 | Gretchen Mogensen

[Reverend Wright]

Angelo Mozilo can finally get on with his life.

This month the Justice Department told Mr. Mozilo, the former chief executive of Countrywide Financial, once the nation’s largest subprime mortgage lender, that he was no longer under investigation in connection with civil mortgage fraud. The government’s criminal inquiry into Mr. Mozilo’s role in the financial crisis was dropped previously, so he is now in the clear.

At least that’s the view from Washington. On Main Street, where the pain of Countrywide’s reckless lending and abusive foreclosure practices still throbs, it’s safe to say that Mr. Mozilo is still identified as a major figure in the mortgage crisis.

Countrywide, a freewheeling mortgage machine co-founded by Mr. Mozilo and based in Southern California, was at the epicenter of the mortgage meltdown that in 2008 brought the nation’s economy to its knees. Perennially tanned and fond of flashy suits, Mr. Mozilo personified the home-lending good times that ultimately went bad. The decision by the government to close the book on Mr. Mozilo is something of a milestone and a moment to revisit the deeds of the company he co-founded.

[Reverend Wright]

how can they convict anyone if this scumbag walks ?

BTW, no mention of the "Friends of Angelo" and their preferential mortgages on Capitol Hill, surprise, surprise...!

[Brian Griffin]

You had to apply for a mortgage to get one.

The new mortgages now being issued on Obama’s watch will often be painful for years too.

[Brian Griffin]

“In 2006 Countrywide financed 20% of all mortgages in the United States”

“Between 1982 and 2003, Countrywide delivered investors a 23,000.0% return”

https://en.wikipedia.org/wiki/Bank_of_America_Home_Loans

[rstrahan]

Having seen the fraud from the inside, just goes to show that big donations to “He whose name must not be spoken” can be highly beneficial

[major-pelham]

curious why so strong a word? Capitalists are capitalists even more when stupid pols insure their losses- right? The scumbags here are the government weasels, not the business people.

[proxy_user]

He’s one of the world’s most successful crooks. The key is not to do anything that is obviously illegal, or write down any instructions to subordinates that might come back to haunt you.

Instead, make it clear to everyone that you are out to make money in any way possible, but you don’t want to know the details.

[Liz]

8/20/2014 NYPOST--Bank of America agrees to pay $17B to clean up mortgage mess / By Associated Press

Bank of America has reached a record $17 billion settlement to resolve an investigation into its role in the sale of mortgage-backed securities before the 2008 financial crisis, officials directly familiar with the matter said Wednesday. One of the officials, who spoke with The Associated Press on condition of anonymity because the announcement isn’t scheduled until Thursday at the earliest, said the bank will pay $10 billion in cash and provide consumer relief valued at $7 billion.

The deal is the largest settlement arising from the economic meltdown in which millions of Americans lost their homes to foreclosure. It follows agreements in the last year with Citigroup for $7 billion and with JPMorgan Chase & Co. for $13 billion.Like the Bank of America deal, those settlements were a mixture of hard cash and “credits” for various forms of consumer aid that the banks promised to provide in coming years.

The Bank of America settlement was negotiated through a joint federal and state working group established by President Barack Obama two years ago with the Justice Department and other federal and state authorities. Individual states are expected to share in the settlement. Justice Department spokeswoman Ellen Canale declined to comment, as did New York Attorney General Eric Schneiderman, a co-chairman of the group. The bank also declined comment.

The deal requires Bank of America to acknowledge making serious misrepresentations about the quality of its residential mortgage-backed securities issued by itself and by Countrywide Financial and Merrill Lynch. Those institutions were acquired by the bank when they were on the brink of failure in 2008 and they were responsible for the bulk of the questionable loans.

The deals are intended to offer some financial relief to homeowners, whose mortgages were bundled into securities by the banks in question and then sold to investors. The securities contained residential mortgages from borrowers who were unlikely to be able to repay their loans. Still, the securities were promoted as relatively safe investments until the housing market collapsed and investors suffered billions of dollars in losses.

The poor quality of the loans led to huge losses for investors and a slew of foreclosures, kicking off the recession that began in late 2007. The cash totals now being paid by some of the country’s largest banks are not nearly enough to reverse the damages caused by the bursting of the housing bubble and the ensuing recession.

Bank of America, led by CEO Brian Moynihan, had argued that it shouldn’t be held liable for the subprime mortgages issued by Countrywide and Merrill Lynch. Combined, those three firms issued $965 billion in mortgage-backed securities from 2004 to 2008, according to public records. Roughly 75 percent of that total came from Countrywide Mortgage.

In a federal lawsuit last year, the Securities and Exchange Commission charged Bank of America and two subsidiaries with defrauding investors in an offering of residential mortgage-backed securities by failing to disclose key risks and misrepresenting facts about the underlying mortgages.

The Justice Department filed a parallel civil action against Bank of America alleging violations of the Financial Institutions Reform, Recovery, and Enforcement Act

SOURCE. http://nypost.com/2014/08/20/bank-of-america-agrees-to-pay-17b-to-clean-up-mortgage-mess/

[SaveFerris]

Obama?

Is that why this guy is being let free?

[Liz]

7/6/2012 NYP---Brooklyn Rep. Edolphus Towns treated to VIP mortgage rates: House report / ANDY SOLTIS

Brooklyn Congressman Edolphus Towns got a discount mortgage rate on his Cypress Hills house from Countrywide.

Despite his repeated denials, Brooklyn Rep. Edolphus Towns got two sweetheart loans from a now-defunct mortgage giant, a congressional report said yesterday.

In less than a month in 2003, Towns got a $182,972 mortgage on a vacation home in Lutz, Fla., and a $194,540 mortgage on his Cypress Hills, Brooklyn, residence, both from Countrywide Financial Corp. The report from the House Oversight Committee didn’t say how much Towns saved by getting the loans through Countrywide’s VIP Loan Unit.

But it said the standard savings for VIPs was 0.5 percent and the waiving of so-called junk fees of $350 to $400. Over the course of a 30-year loan, a typical homeowner with a half-point higher rate would pay thousands of dollars more than Towns and other VIPs.

Towns was among eight former and current congressmen, senators and Cabinet secretaries — and hundreds of others — who received discounted loans in a bold bid by Countrywide, the nation’s largest mortgage lender and a specialist in subprime loans, to buy influence, the report said.

Towns, who is retiring from Congress after 30 years, continued to deny he was treated specially by Countrywide. “He did not knowingly benefit from this program,” said Towns’ spokesman Charles Lewis. “He was not aware that he was in [the VIP Loan] program.” “He feels that the mortgage rate [he received] was the fair market rate,” Lewis added. But documents acquired by the oversight committee — which Towns once chaired — show Countrywide was well aware of whom he was.

Towns identified his employer as “US Capital” on both loan applications. But in the “customer name” line of one Countrywide document, “CONGRESSMAN” was added in large letters.

Also, a Countrywide account executive who spoke with Towns told the “VIP processing team” in an e-mail that the congressman’s credit score might be an issue.No, replied another Countrywide official, “The credit shouldn’t be a problem . . .

Also, this is a congressman, we must get his 3-day package out on time.” The VIP unit gave out sweetheart loans from 1996 until 2008, when the unit’s existence was revealed in news articles.

Some of the discounts, to Washington heavyweights like then-Senate Banking Committee Chairman Chris Dodd (D-Conn.), were personally approved by Countrywide CEO Angelo Mozilo.

Recipients of discounted loans were known inside Countrywide as “Friends of Angelo.” The oversight committee report said Towns issued a subpoena in 2009 — only after “several months of resistance” — to Bank of America, which had acquired Countrywide.

The new report caps a three-year investigation and stops short of calling for the Justice Department to look into criminal violations. Additional reporting by S.A. Millerin Washington asoltis@nypost.com

SOURCE http://www.nypost.com/p/news/local/klyn_pol_weet_deals_WVPui7addFjz8p0qTETExN#ixzz1ztNeNiV1

[2ndDivisionVet]

Where is AmeriQuest in all this?

[Teacher317]

So his checks finally cleared...

[piasa]

Meanwhile, Golden West Financial skates too

[Hoosier-Daddy]

No kidding. Countrywide sold products available, but I never experienced ANYONE in that company trying to commit outright fraud. I had an Ameriquest/Argent rep do a presentation and damn near kicked her out of the office as she was trying to teach the LO’s how to commit fraud.

[Don Corleone]

What did he do, switch from Republican to Democrat?

[2ndDivisionVet]

My manager used “Boiler Room” as a training film.

[Reverend Wright]

Look, capitalism is one thing, massive fraud is something else.

There was massive mortgage fraud by applicants, originators, the investment bankers that created and sold the SIVs and CDOs, ratings agencies, AIG and others who wrote CDS they couldn’t make good on, ...

Then we have the “Friends of Angelo” politicians who pressured the regulators to leave him and others in the fraudulent mortgage machine alone.

Where is the accountability ? All kinds of guys went to jail after the S&L fiasco.