The Securities and Exchange Commission has filed civil fraud charges against Angelo Mozilo, head of the Countrywide Financial mortgage firm, for misleading investors about the company's lending practices. Analysts assess the case's impact.
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The first charges against a major figure in the subprime mortgage crisis have been filed. Angelo Mozilo, who built Countrywide Financial into the country's largest mortgage lender, was charged yesterday with insider trading and civil fraud.
The Securities and Exchange Commission alleges he misled investors about his company's lending practices and its overall financial health.
For a closer look, I'm joined by Gretchen Morgenson, who's been covering the story for the New York Times, and Robert Mintz, a former federal prosecutor and specialist in white-collar crime.
Thank you both.
Gretchen Morgenson, to you first. This is quite a fall for Mr. Mozilo.
GRETCHEN MORGENSON, The New York Times:
It certainly is. You know, Judy, in the years when the mortgage mania was building up, Mr. Mozilo was practically a household name. He was almost the sort of personification of the mortgage industry.
And, remember, this was a sort of a new kind of mortgage lending, where it wasn't your local banker giving you the loan. This was a huge company that he built, really, you know, sort of by the bootstraps, you know, self-made man from the Bronx in New York. So, yes, it really is a fall for him.