Category Archives: Countrywide Financial
A group of Investors for BofA are highly pissed and to that end, they sued Bank of America. From Jurist:
Twelve plaintiffs on Monday combined to file a lawsuit [complaint, PDF] in the New York State Supreme Court [official website] against Countrywide Financial Corporation[NYT backgrounder] alleging widespread fraud that resulted in substantial financial losses. The plaintiffs invested hundreds of millions of dollars with the Bank of America (BOA) [corporate website] subsidiary between 2005 and 2007, believing the purchases of mortgage-backed securities to be “conservative, low-risk investments.” The suit claims that Countrywide “recklessly” misrepresented the stability of the investments and failed to adhere to its stated underwriting and credit analysis procedures, leading the credit ratings of many of the securities to fall significantly. The complaint also names several former Countrywide executives as defendants, and seeks compensatory and punitive damages.
BOA has recently been the target of several lawsuits alleging fraud. Arizona Attorney General Terry Goddard filed a lawsuit in mid-December against BOA for misleading customers [JURIST report] in mortgage modification and foreclosure practices. Earlier in the month, the US Securities and Exchange Commission(SEC) [official website] reached a $137 million settlement agreement [JURIST report] with BOA over fraud charges [order, PDF] in a lawsuit that claimed BOA used anti-competitive bidding processes with 20 state municipalities. In June, BOA subsidiary Countrywide Home Loans, Inc reached [JURIST report] a $108 million settlement agreement [text, PDF] with the Federal Trade Commission (FTC) [official website] in response to a lawsuit that charged it with collecting excessive fees from homeowners facing foreclosure.
Angelo Mozilo has been charged with fraud, leveled by the SEC with regard to Countrywide’s subprime loans.From MSNBC:
Federal regulators on Thursday charged Angelo Mozilo, the former chief executive of mortgage lender Countrywide Financial Corp., and two other company executives with civil fraud.
The Securities and Exchange Commission’s civil lawsuit, filed in federal district court in Los Angeles, also accuses Mozilo of illegal insider trading.
Civil fraud charges also were filed against Countrywide’s former chief operating officer David Sambol, 49, and ex-chief financial officer Eric Sieracki, 52.
The trio “deliberately misled” Countrywide shareholders, SEC enforcement director Robert Khuzami said at a news conference at agency headquarters. While they painted a picture of robust performance, the real Countrywide was “buckling under the weight” of soured mortgage loans, he added.
Countrywide started our trip down the road to depression when they took the first dump.
I hope to hell Angelo does jail time..but I ain’t holding my breath that the over tanned bag of shit does any time in jail. I would feel much better if the FBI charged this fuckwit. Angelo knew Countrywide was taking a shit but sold his shares for over $140 million dollars before they fell from grace. Again, from the MSNBC writeup:
The SEC is seeking injunctions and unspecified civil fines against Mozilo, Sambol and Sieracki and wants them to be barred from serving as officers or directors of any public company. The agency also is seeking unspecified restitution of allegedly ill-gotten profits from Mozilo and Sambol.
Fry those bastards..please.
In a deal that saves the ass of the nation’s largest mortgage lender, Bank of America has agreed to buy Countrywide in a ‘stock-only’ sale. Countrywide has been rumored to of been considering a Chapter 11 filing recently with the value of their stock at a garbage rate of $5 a share in December. “As of Sept. 30, Countrywide’s savings bank held about $79.5 billion of loans as investments. Three-quarters of these loans were second-lien home-equity loans — where Countrywide doesn’t have first crack at the collateral in case of default”-according to the Wall Street Journal.
The WSJ has a nice explanation of what it all means here. The person who makes out like the bandit he is in this deal?
Why, the founder of Countrywide of course. Chief Executive Angelo Mozilo. Angelo might be taking home a nice little golden parachute of..wait for it…
Oh, and Angelo will also get his countryclub dues paid through the year 2011 and get to use the corporate jet. Chuck Shumer had this to say about Angelo’s sweet deal: