Feds Reportedly Drop Mozilo Indictment Efforts
Subscribe

Feds Reportedly Drop Mozilo Indictment Efforts

June 17, 2016
The Federal Deposit Insurance Corporation (FDIC) suffered an embarrassing courtroom defeat when a federal judge dismissed lawsuits brought by the agency against three major banks in a case relating to the failed sale of mortgage debut by a defunct Texas b

The executive that many mortgage industry critics considered to be deeply tanned face of housing bubble is reportedly no longer in threat of being indicted by the federal government.

According to a Bloomberg report that cited “people familiar with the matter,” the U.S. Department of Justice (DOJ) will not pursue civil charges against Angelo Mozilo, the co-founder of Countrywide Financial Corp. Mozilo was held up to scrutiny and scorn for his prominence within the industry—he was earning at least $500 million during the decade prior to the 2008 financial meltdown—but he was never brought to trial for his role in Countrywide’s problematic mortgage business. The Justice Department began to investigate the possibility of a civil case against Mozilo in 2014, but it is not clear why their investigation as abandoned.

In 2010, Mozilo agreed to a $67.5 million penalty settlement with the U.S. Securities and Exchange Commission that did not require any admission of wrongdoing, with Bank of America (which acquired Countrywide in 2008) paying part of the settlement. In recent years, Mozilo has mostly been out of the spotlight – one of his last interviews took place in 2014, when he defended himself and his former company against charges of contributing to the housing bubble.

“Countrywide or Mozilo didn’t cause any of that,” he said at the time.

Compliance