Countrywide: The New Enron

Lora Bentley

It didn't take long for the fall of Enron to become synonymous with the sad state of corporate accounting and reporting that gave rise to Sarbanes-Oxley. And now that all of the Enron execs involved in the scandal have been tried and punished where appropriate, we have a brand-new scandal on our hands.

 

The fall of Countrywide Financial is quickly becoming synonymous with the subprime mortgage scandal. In fact, in Thursday's PalmBeachPost.com, Countrywide CEO Angelo Mozilo is nicknamed "the new Ken Lay." He reportedly sold $145 million in stock options just before the company fell into bankruptcy.

 

Now the SEC and the House Oversight and Government Reform Committee want to know just how Mozilo managed to come out unscathed when so many others lost everything. Mozilo will appear before the House committee in February. The question, according to PalmBeachPost.com, is where Mozilo falls in the mix of fraud, greed and stupidity that made up the "subprime meltdown."



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Jan 18, 2008 8:10 AM Dan Dan  says:
I am glad I am NOT getting involved with CountryWide mortgage. I received LOTS of junk mail from them recently, and I am rightfully concerned that I would pay LOTS of fees to them, only to get the response "DECLINED FILE", or get a committment from CountryWide to fund a mortgage, only NOT to get the actual funding. Then, to add "Selt to the Wound", be required to make payments to a mortgage I never got benefit from. Reply
Jan 19, 2008 7:42 AM vimsam vimsam  says:
HiI have a Fixed deposit with Countrywide Bank. Will there be any impact? I believe both the companies Countrywide Financial & Countrywide Bank belong to the same group of companies.I think all deposits are FDIC Insured. But would appreciate if I can get a response from someone. I am concerned.Thanks Reply
Jan 23, 2008 3:12 AM Joe Joe  says:
I worked for CW for over 5 years and all you heard was the "good" stuff until the end of 2006. Then came the supposed cost cutting (primarily in the US). The India location was ramping up to keep up with the work from the US layoffs.Angelo isn't the only one that should be investigated. I've heard through many of my friends that just before the BofA buy-out, many (and I mean many) of the execs bought CW stock, then sold it once it came up those 2 or 3 dollars after the sale. Geez, that wouldn't be insider trading would it? Reply

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