4 House members got Countrywide VIP loans, Rep. Darrell Issa says
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Four current House members received special VIP loans from Countrywide Financial Corp., and their names have been forwarded to the Ethics Committee for possible action, Rep. Darell Issa (R-Vista) said.
Issa, who chairs the House Oversight and Government Reform Committee, said an ongoing investigation by his panel discovered the information. He did not name the members in referring the matter to the Ethics Committee in a letter Friday.
‘Testimony and documents show that Countrywide used the VIP program to build relationships with government officials and others positioned to advance Countrywide’s business interests,’ Issa wrote to Ethics Committee Chairwoman Jo Bonner (R-Ala.) and top Democrat Linda T. Sanchez (D-Lakewood). The loans often came at lower interest rates and fees than were available to the public.
A spokesman for the Ethics Committee would not comment on the letter. The committee usually does not talk about specific allegations or referrals until it reaches a finding.
The oversight committee received about 100,000 pages of documents related to the VIP loan program after issuing a subpoena in February to Bank of America, which now owns Countrywide, the former Calabasas lender. The VIP program also was known as ‘Friends of Angelo,’ a reference to Countrywide’s former Chief Executive Angelo R. Mozilo.
Under Mozilo, Countrywide helped fuel the subprime mortgage boom and cultivated relationships with Washington policymakers. Last year, Mozilo agreed to a $67.5-million settlement of civil fraud and insider-trading allegations by the Securities and Exchange Commission.
Although Issa’s letter did not name the current House members, Rep. Edolphus Towns (D-N.Y.) publicly has acknowledged receiving two mortgages from Countrywide. Staffers for Towns have said he doesn’t believe the loans came with any special benefits.
[Updated at 12:42 p.m., Dec. 19: Towns spokesman Charles Lewis said the lawmaker was not involved in a VIP program at Countrywide and received no benefits that were not available to everyone else.]
In 2009, the Senate Ethics committee cleared Sen. Kent Conrad (D-N.D.) and former Senate Banking Committee Chairman Christopher J. Dodd (D-Conn.) of violating rules in receiving VIP mortgages from Countrywide.
The senators said they didn’t think they were getting any special treatment. But the committee said they ‘should have exercised more vigilance’ in their dealings with Countrywide to avoid the appearance of preferential treatment.
The House Oversight Committee has been investigating the Countrywide VIP program since 2008. The committee issued a report last year finding that Countrywide made 173 preferential mortgages over about a decade to employees of housing finance giants Fannie Mae and Freddie Mac, which purchased many of the company’s loans.
-- Jim Puzzanghera