Countrywide Financial won influence with discounts, report says

Countrywide Financial won influence with discounts, report says

WASHINGTON â€" The former Countrywide Financial Corp., whose subprime loans helped start the nation's foreclosure crisis, made hundreds of discount loans to buy influence with members of Congress, congressional staff, top government officials and executives of troubled mortgage giant Fannie Mae, according to a House report obtained by the Associated Press.

The House Oversight and Government Reform Committee named six current and former members of Congress who received discount loans from January 1996 to June 2008, but all of their names had surfaced previously. Other previously mentioned names included former top executive branch officials and three chief executives of Fannie Mae.

"Documents and testimony obtained by the committee show the VIP loan program was a tool used by Countrywide to build goodwill with lawmakers and other individuals positioned to benefit the company," the report said. "In the years that led up to the 2007 housing market decline, Countrywide VIPs were positioned to affect dozens of pieces of legislation that would have reformed Fannie" and its rival Freddie Mac, the committee said.

Some of the discounts were ordered personally by former Countrywide Chief Executive Angelo Mozilo. Those recipients were known as "friends of Angelo."

The report said documents and testimony showed that Mozilo and company lobbyists "may have skirted the federal bribery statute by keeping conversations about discounts and other forms of preferential treatment internal. Rather than making quid pro quo arrangements with lawmakers and staff, Countrywide used the VIP loan program to cast a wide net of influence."

Among those who received loan discounts, the report said, were:

• Former Senate Banking Committee Chairman Christopher J. Dodd (D-Conn.).

• Senate Budget Committee Chairman Kent Conrad (D-N.D.).

• Rep. Howard P. "Buck" McKeon (R-Santa Clarita), chairman of the House Armed Services Committee.

• Rep. Elton Gallegly (R-Simi Valley).

• Former Rep. Tom Campbell (R-San Jose).

• Mary Jane Collipriest, communications director for former Sen. Robert F. Bennett (R-Utah), then a member of the Banking Committee.

• Rep. Edolphus Towns (D-N.Y.), former chairman of the House Oversight Committee. Towns issued the first subpoena to Bank of America for Countrywide documents, and current Chairman Darrell Issa (R-Vista) subpoenaed more documents.