Report: Countrywide abused 'VIP Program'

July 5, 2012 at 1:45 PM
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WASHINGTON, July 5 (UPI) -- The U.S. House of Representatives' report on Countrywide Financial said the company used its "VIP Program" to "integrate itself with policymakers."

House Oversight and Government Reform Committee Chairman Darrell Issa, R-Calif., released a report Thursday saying the three-year investigation into Countrywide's "Friends of Angelo" and "VIP Program" found the programs were used to bolster the company's lobbying and strengthen ties with the taxpayer-backed Fannie Mae for joint lobbying efforts.

"The Committee's investigation found Countrywide lobbyists and CEO (chief executive officer) Angelo Mozilo used discounted loans as a tool to ingratiate itself with policymakers in an effort to benefit the company's business interests," Issa said. "A former lobbyist for Countrywide testified that members of Congress, staff, and other government officials were directed to the company's VIP program as part of an effort to create a favorable impression of the company on Capitol Hill. This preferential treatment -- that varied depending on the influence of the borrower -- was not routinely offered to the public."

"In addition, this report sheds new light on Countrywide's relationship with Fannie Mae and how Countrywide used its VIP Program to cement its ties to its taxpayer backed business partner.

"Other than Countrywide, no other entity's employees received more VIP loans than Fannie Mae. Even as Countrywide's CEO Mozilo mocked Fannie Mae and top executives for its crony capitalism business model, he would nonetheless personally intercede to ensure executives had access to discounted Countrywide loans. These relationships helped Mozilo increase his own company's profits while dumping the risk of bad loans on taxpayers," Issa said.

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