Connect with us

Hi, what are you looking for?

The American GeniusThe American Genius

Economic News

Mozilo claims mortgage crisis is fault of homeowners

Many consider Mozilo to be the greatest mortgage villain of all time, but he’s avoided criminal charges, and now has the audacity to blame homeowners and values for Countrywide’s woes, still claiming his leadership was good.

mozilo

mozilo

Mozilo claims Countrywide wasn’t the problem

According to a 2011 deposition of former Countrywide CEO, Angelo Mozilo released this month, Mozilo firmly denies that his company was the problem, after the purchase of the mortgage company did massive damage to Bank of America. Alluding to the company as his sixth child, he said under oath that Countrywide, a “world-class company” was sold to Bank of America just as the housing bubble burst, and that the economy was to blame for the mortgage crisis, allotting no blame to Countrywide.

Many consider Mozilo a disgraced industry insider, best known for paying $67 million to settle with the Securities and Exchange Commission (SEC) two years ago. When asked in court if he had regrets regarding how he operated Countrywide, after all of the foreclosures, “ruined lives,” and lawsuits, to which he placed blame completely on home values that fell, and homeowners that gave up and walked out.

Mozilo said, “These people didn’t lose their jobs. They didn’t lose their health. They didn’t lose their marriage. Those are the three factors that cause foreclosure. They left their home because the values went below the mortgage. That’s what caused the problem.”

In addition to Mozilo insulting homeowners, he asserted in court that he was a great leader because Countrywide didn’t make loans in Greece, Ireland, or Portugal, insinuating that the Eurozone crisis is also to blame, but again, he is not to blame.

Advertisement. Scroll to continue reading.

Mozilo’s rocky past

A few years ago, the SEC alleged that Mozilo knowingly and falsely reassured investors about the quality of Countrywide loans, and right before the crash, Mozilo gained $140 million of “improper gains” from insider stock sales. For these two things alone, many believed he should be held criminally responsible for, but the case was, and still is “shelved.” Interestingly, the “Friends of Mozilo” scandal still pops up new names of celebrities and politicians that got sweetheart mortgage deals through Mozilo himself.

Mozilo maintains his criminal innocence despite the SEC settlement and the State of California ruling that he and another exec pony up $6.5 million for predatory lending.

In 2008, Bank of America purchased Countrywide for $4 billion, absolving Mozilo of his involvement, leading to over $40 billion in litigation and settlement costs, with more lawsuits rolling in every month against Countrywide.

Although Countrywide remains the named defendant, Bank of America as the new owner is responsible for any costs associated with the final result of the endless lawsuits, because Countrywide can be Mozilo’s “sixth child” all he wants it to be, but Bank of America CEO Brian Moynihan is the new daddy, and he’s responsible for all of the damage still being uncovered so many years later.

[ba-pdfviewer pdfurl=”https://theamericangenius.com/wp-content/uploads/2012/12/Mozilo-Deposition.pdf” width=”100%” height=”900px”]

Advertisement. Scroll to continue reading.

Tara Steele is the News Director at The American Genius, covering entrepreneur, real estate, technology news and everything in between. If you'd like to reach Tara with a question, comment, press release or hot news tip, simply click the link below.

8 Comments

8 Comments

  1. George L. Duarte

    December 20, 2012 at 3:49 pm

    Countrywide and World Savings approved any clown with a pulse to broker loans for them- hustlers, thieves, shysters of all types were sweeping floors one day, then mortgage brokers the next thanks to Angelo and World! Quick buck artists got in the business to screw as many people out of as much money as possible accordingly. Their evil practices were enabled by dense and confusing disclosures, Notes, Deeds in legalistic language no one could understand.

  2. fredglick1

    December 20, 2012 at 3:50 pm

    Dick

  3. George Berdos Jr.

    December 20, 2012 at 4:03 pm

    Funny thing, they don’t loan money to people that do not apply. So the headline is partially correct. As for the mortgage bankers fudging the documentation and doing other illegal stuff regarding the mortgage loan file, they bear responsibility for that.

Leave a Reply

Your email address will not be published. Required fields are marked *

Advertisement

The
American Genius
news neatly in your inbox

Subscribe to our mailing list for news sent straight to your email inbox.

Advertisement

KEEP READING!

Housing News

(Mortgage) Despite his role in the most colossal mortgage company failures in history, the mysteriously orange Mozilo claims the world wants to punish him...

Business Finance

(Business Finance) Bank of America has seen the fallout from bad choices leading up to the economic crash, and one executive is facing the...

Housing News

Bank of America will shell out $404 million to settle their final claim between the big bank and Freddie Mac and Fannie Mae, covering...

Housing News

When Bank of America acquired Countrywide in 2008, they also acquired their problems. And fraud.

The American Genius is a strong news voice in the entrepreneur and tech world, offering meaningful, concise insight into emerging technologies, the digital economy, best practices, and a shifting business culture. We refuse to publish fluff, and our readers rely on us for inspiring action. Copyright © 2005-2022, The American Genius, LLC.