Ex-Countrywide CEO Mozillo charged with fraud. :)


Federal regulators on Thursday charged Angelo Mozilo, the former chief executive of fallen mortgage lender Countrywide Financial Corp., with civil fraud and illegal insider trading in a prominent case arising from the financial meltdown.

The Securities and Exchange Commission also accused two other former executives of Countrywide of civil fraud, saying they and Mozilo “deliberately” misled investors about the risks the company assumed in its aggressive drive for a share of the booming mortgage market.
The SEC’s civil lawsuit was filed in federal court in Los Angeles, naming Mozilo, Countrywide’s former chief operating officer David Sambol, 49, and ex-chief financial officer Eric Sieracki, 52.

A trail of e-mail messages sent by Mozilo in 2006, before the subprime mortgage market collapsed in 2007, underlined the SEC’s allegations.
In all my years in the business I have never seen a more toxic product,” Mozilo told Sambol in an e-mail on April 17, 2006. He was referring to the so-called 80/20 subprime loans that let borrowers borrow 100 percent of a home’s value by borrowing 80 percent in the primary mortgage and then 20 percent in a secondary loan. “There has to be major changes in this program,” Mozilo wrote.

Following a meeting with Sambol to discuss the company’s holdings of so-called pay-option ARM loans, the Countrywide chief wrote on Sept. 26, 2006 that, “The bottom line is that we are flying blind on how these loans will perform in a stressed environment of higher unemployment, reduced values and slowing home sales.”

Old Orangeface is just a scapegoat, I’m sure. But it’s a start.

Civil lawsuit means no jailtime but he can be sued for damages and return of ill gotten gains, right? Plus a jury trial in California?

When are these guys going to learn that you don’t write that sort of shit down? Especially not in email (hey guys, its the INTERNET. NOTHING ever disappears from the INTARWEB!)

Personally, I think him, and a lot of other bankers and CEOs, need to have all of their personal assets taken from them, and banned from working anywhere. Then maybe they’ll find out what its like to not know how one is paying the next mortgage payment, or putting food on the table.

Yeah the more you read the more you get angry. The heads of these companies knew this was shaky, the people in Congress heading up the oversight committees knew it, and everyone just let it happen.

Yep he needs to lose EVERYTHING he has… but I’d still like to see jail-time. The problem is he has lots of friends in high places so he’ll still have a plush place to live and never have to worry about where his next meal will come from.