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Business

Mortgage crisis ‘villain’ Angelo Mozilo: ‘I don’t care’ anymore

By
Carleton English
Published May 9, 2019
Updated May 9, 2019, 7:27 p.m. ET

Angelo Mozilo is done being the villain.

Speaking at an exclusive hedge fund conference in Las Vegas this week, the disgraced former head of Countrywide Financial said he doesn’t care that he is still being held responsible for the 2008 financial meltdown, driven by a collapse in shoddy subprime loans, many of them sold by Countrywide.

“A lot of years went by, my wife passed away, I turned 80 years old, and now I don’t care,” Mozilo said, eliciting nervous laughter from the crowd gathered at the SALT Conference in Las Vegas.

“There’s other things more important in life,” said Mozilo, 81, wearing his trademark suntan and white-collared shirt.

“Somehow, for some unknown reason, I got blamed for it,” said Mozilo, who was charged with insider trading and securities fraud by the SEC in 2009 tied to his Countrywide stock sales and emails detailing concerns about the company’s subprime products at a time when he was publicly touting the stock.

He settled the case for $67.5 million and accepted a lifetime ban from serving as an officer or director of a public company, but didn’t admit any wrongdoing.

Mozilo, the son of a butcher in the Bronx, also used the SALT stage to stand up for Countrywide, which was bought by Bank of America during the throes of the crisis — causing billions in losses to BofA for years.

At the time, Countrywide was the largest mortgage lender in the US and it had lowered its lending standards to aggressively offer mortgages to people with questionable means to pay them back.

“They didn’t deserve the reputation they were given. Because we were the largest involved, because we were so visible, because I was so visible, we were an easy mark,” Mozilo insisted.

He also defended Countrywide’s much maligned lending practices, saying the company’s lower standards allowed it to provide homes to minorities and other groups of people shut out of the traditional banking industry.

But emails between Mozilo and other Countrywide executives leading up to the financial crisis show that he was privately concerned about the poor lending standards.

“In all my years in the business I have never seen a more toxic prduct [sic],” he wrote in 2006 about the company’s 80/20 loans. “In addition, the FICOs are below 600, below 500 and some below 400,” he wrote, referring to the borrowers’ credit scores.

He called another Countrywide product “the most dangerous product in existence,” saying “there can be nothing more toxic and therefore requires that no deviation from guidelines be permitted irrespective of the circumstances.”

Mozilo, who founded Countrywide in 1969, was named by Time Magazine as one of the top 25 people to blame for the financial crisis, and by CNN as one of the “Ten Most Wanted: Culprits” of the meltdown, which led to millions of people being driven from their homes as housing prices declined.

“He is a friend of mine and I wanted to give him an opportunity to reflect on what happened and tell his side of the story,” said Anthony Scaramucci, President Trump’s short-lived former press secretary and conference host.