Once upon a time, Countrywide was one of the nation’s top lenders, but fell after taking too many risky loans. Since then, Bank of America has acquired their loans, Mozilo settled with the SEC for $67.5 million, and today it is announced that federal prosecutors have “shelved” the criminal investigation against Mozilo.
Industry insiders consider Mozilo to be criminally responsible for misleading investors and calling Countrywide’s portfolio healthy and leading investors to believe the risks being taken were sound. Mozilo gained $140 million of “improper gains” from insider stock sales.
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.
Several investors are still suing Mozilo personally and those cases continue, however the criminal case has been dismissed.
This story will heat up over the weekend as Americans continue to suffer at the hands of an era of executives who knowingly participated in predatory lending practices.