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Angelo Mozilo has lots of friends. Or at least, he used to. The former chief executive of Countrywide Financial now faces a series of federal lawsuits, including one brought by the Securities and Exchange Commission for fraud and insider trading. Suddenly, some of the most powerful Washington politicians are eschewing the shameful appellation "Friend of Angelo."
Back in the early 1990s, when Countrywide was climbing to the top of the mortgage industry, Mr. Mozilo was looking to make friends on Capitol Hill. According to documents obtained by congressional oversight investigators, these key VIPs were afforded preferential and personalized treatment, including specially priced home mortgage loans at below-market rates. This generosity was not limited to elected officials but was extended as well to select congressional staff members, administration officials and Washington lobbyists.
In his aggressive pursuit of market dominance, Mr. Mozilo tried to make friends everywhere, especially among people who had a primary responsibility to craft legislation and oversee government enterprises with a stake in the U.S. housing market.
In March 2009, the minority staff of the House Committee on Oversight and Government Reform produced a detailed, 63-page report that analyzed Countrywide's VIP program and Mr. Mozilo's successful scheme to buy political influence and manipulate public policy decisions.
At that time, I renewed my call for congressional hearings into the Countrywide scandal, but my requests have been denied repeatedly and obstructed by the Democratic majority.
While some have attempted to characterize our efforts to uncover the true scope and depth of this pay-for-play program as a partisan attack targeting specific members of Congress, it should be noted that Republicans controlled both Congress and the White House at the height of the Countrywide VIP program's influence.
It stands to reason, therefore, that more Republicans than Democrats could have been the beneficiaries of Mr. Mozilo's special treatment. The undisputed fact remains: We know there was corruption. We know Countrywide's intent was to influence decision-makers to pursue policies that favored Countrywide's portfolio.
Yet congressional Democrats seem afraid to move forward with the investigation into a bribery scandal that contributed to the housing crisis and the financial collapse.
A variety of excuses have been offered for Congress' failure to launch a full-scale probe into the Friends of Angelo program. At first, it was argued that deference was needed for the Senate Ethics Committee to conclude an investigation into the conduct of two senators.
Then speculation concerning a Justice Department investigation was cited to trump congressional oversight. Never mind the fact that Democrats and Republicans in Congress had worked together to investigate the Jack Abramoff scandal, even though the Justice Department continues to prosecute actions connected to this wrongdoing to the present day.
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