Thread: Another Democrat Snared in Countrywide Loan Scandal

Another Democrat Snared in Countrywide Loan Scandal

Friday, August 7, 2009 10:47 AM

A leading Democrat in the House of Representatives who has rebuffed Republican efforts to subpoena records of a mortgage program for favored borrowers at Countrywide Financial Corp got home loans from that lender, the Wall Street Journal reported on Friday.

Representative Edolphus Towns, chairman of the House Oversight and Government Reform Committee, obtained two loans from Countrywide, which was bought last year by Bank of America, the newspaper said, citing information from the lawmaker's mortgage documents.

Towns has turned down calls from the committee's ranking Republican, Darrell Issa, for the panel to subpoena mortgage records showing who received loans through Countrywide's VIP program, the journal said.

The program offered loans to politically influential figures and other favored borrowers at more attractive terms than were available to the general public.

The mortgage documents on the loans to Towns contain a Countrywide address and branch number that correspond to the VIP program, the Journal reported.

Towns told the paper through a spokeswoman that his decision not to subpoena the VIP records "has nothing to do with his mortgages" and that if the mortgages came through the VIP program "it was without his knowledge."

Towns was not immediately available for comment outside regular U.S. office hours.

In June, Issa wrote to Bank of America asking it to disclose any special mortgage terms the bank's Countrywide unit gave to politically influential customers over an eight-year period. Bank of America bought Countrywide last year after the mortgage lender collapsed under the weight of bad mortgages and defaults.

Countrywide's VIP program of preferential mortgage rates was also known as the "Friends of Angelo" program, after Countrywide founder Angelo Mozilo.

In February, Senate Banking Committee Chairman Chris Dodd, a Democrat, said he would refinance two mortgages that he took out in 2003 under Countrywide's VIP program.

http://moneynews.newsmax.com/financenew ... 45223.html

Congress Covers Up Countrywide Loan Scandal
Fri, 08/07/2009 - 12:30pm
Indicating an extensive cover-up effort, the chairman of the U.S. House’s main investigative committee has blocked subpoenas to obtain records of a special mortgage program for the politically connected because he too benefitted from it.

As chairman of the powerful Committee on Oversight and Government Reform, New York Democrat Edolphus Towns is supposed to investigate federal wrongdoing not cover it up. This is why it seems suspicious that the 26-year congressional veteran has ardently rebuffed efforts to obtain records involving a controversial program that offered heavily discounted loans to politically influential figures like him.

The secret low-mortgage rate deals were part of a VIP program available only to powerful friends of the now-defunct bank’s (Countrywide Financial Corp.) crooked Chief Executive Officer, Angelo Mozilo, a key player in the nation’s subprime-mortgage meltdown who has been charged with fraud and insider trading.

When Countrywide’s bad mortgages inevitably led to its collapse, the shady undercover deals were exposed and triggered investigations by two congressional committees because numerous lawmakers were involved. Among them is a pair of high-profile Democratic U.S. Senators (Christopher Dodd, chairman of the Senate Banking, Housing and Urban Affairs Committee and North Dakota’s Kent Conrad, chairman of the Senate Budget Committee) who recently said the perk was merely a courtesy similar to frequent flyer miles offered by airlines.

In an effort to fully investigate all the players involved in the unethical deals, members of Congressman Towns’ investigative committee proposed subpoenaing bank records. Towns has gone out of his way to make sure that doesn’t happen, probably because he received two Countrywide loans, according to the newspaper that broke the story this week.

A former Brooklyn social worker and community activist, Towns was conveniently unavailable to comment on his deals but his spokesman assured that if the loans came through the VIP program “it was without his knowledge.â€