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HUD Secretary Henry Cisneros and Alphonso Jackson VIP's on "Friends of Angelo" List
Thursday, 17 February 2011

Countrywide Subpoena Could Make a Few Powerful People Nervous
Details of the subpoena might make more than a few powerful people nervous. This is the first time anyone has sought records regarding all government officials who may have benefitted from the so-called "Friends of Angelo" and other VIP programs that Countrywide had. Congressional investigations have revealed Countrywide extended favorable terms to powerful shakers-and-movers in government in hopes of wielding influence. VIP mortgages were also given to President Clinton's former Housing Secretary Henry Cisneros, and President Bush's Housing Secretary Alphonso Jackson. Jackson's daughter even got VIP loan status when an internal Countrywide e-mail noted her father "is expected to be confirmed as Secretary of HUD."

Countrywide Subpoena Could Make a Few Powerful People Nervous

By Sharyl Attkisson 7 comments

 

 Rep. Darrell Issa (R-Calif.), the new Chairman of the House Committee on Oversight and Government Reform, issued his first subpoena: it's in the investigation of the Countrywide scandal.       

Details of the subpoena might make more than a few powerful people nervous. This is the first time anyone has sought records regarding all government officials who may have benefitted from the so-called "Friends of Angelo" and other VIP programs that Countrywide had. Congressional investigations have revealed Countrywide extended favorable terms to powerful shakers-and-movers in government in hopes of wielding influence.                 

 

In the past, when his party was a less-influential minority in the House, Issa pushed for a wide-ranging subpoena of Countrywide documents. But he was rebuffed by then-Chairman Rep. Edolphus Towns (D-N.Y.). As CBS News previously reported in 2009, Towns was one of the VIP's who received loans from Countrywide. Towns eventually agreed to issuing a subpoena, but it was much narrower than Issa requested, and did not include gathering information on public officials.

This time, with Issa in full charge of the committee, he is demanding information on borrowers who are:

  • A current or former officer or employee of a federal agency
  • A current or former Member, officer, or employee of the U.S. Congress
  • A current or former officer or employee of a government-sponsored enterprise
  • A current or former officer or employee of a state or local government

In 2009, a Countrywide whistleblower told Congress that the company aggressively courted those in position to influence regulations... as it made billions by giving out risky loans then selling them to government-backed Fannie Mae. Billions of dollars worth of those loans defaulted at taxpayer expense.

"It wasn't just to give (government officials) a good deal, it was to make sure they knew, or at least they believed that they were getting a special deal," Anthony Salerno, the attorney for the Countrywide whistleblower Bob Feinberg told Congress.

Feinberg worked in Countrywide's VIP section that offered preferential treatment to so-called "Friends of Angelo": customers referred personally by CEO Angelo Mozilo. Special terms included knocking a full point, or one percent, off a loan. On a two million dollar VIP mortgage, that's a perk worth $20-thousand dollars.

In August, 2009, two Senators linked to the scandal, Kent Conrad (D-N.D.) and Chris Dodd (D-Conn.), were cleared of violating ethics rules for getting VIP loans from Countrywide. But the Ethics Committee said they "should have exercised more vigilance" and their VIP loan status "should have raised red flags."

As
CBS News reported in earlier investigations, House staffers also received VIP treatment from Countrywide and internal emails left no doubt as to why. E-mails called various House staffers " a big supporter of Countrywide's" or "responsible for... legislation of interest and importance to Countrywide."

Some of the most flagrant connections were with the House Financial Services Committee, which had oversight authority over Countrywide. Clinton Jones, a Chief Counsel for the committee, got VIP treatment. Internal Countrywide emails read, in part: "Jones is...an advisor to ranking Republican members of Congress responsible for legislation of interest to the (financial services) industry and of importance to Countrywide."

A committee aide asked Countrywide to help his sister and brother-in-law after they got turned down for refinancing. Countrywide obliged calling the staffer "an aide to a senior member of the House Financial Services (Committee).. a big supporter of Countrywide's..." and "very important to us."

CBS News learned VIP mortgages were also given to President Clinton's former Housing Secretary Henry Cisneros, and President Bush's Housing Secretary Alphonso Jackson. Jackson's daughter even got VIP loan status when an internal Countrywide e-mail noted her father "is expected to be confirmed as Secretary of HUD."

Also on the list: Franklin Raines, then-CEO of Fannie Mae and former Fannie Mae CEO James Johnson, one-time advisor to President Obama. Fannie Mae bought billions in toxic Countrywide loans. Others include former Clinton cabinet member Donna Shalala, former U.N. Ambassador Richard Holbrooke and former White House staffer Paul Begala.

All of those who received VIP loans and have given any comment have said they never sought nor received any special mortgage benefits.

Today's subpoena was delivered to Bank of America, which purchased Countrywide. Bank of America has previously notified Congress that some requested records and documents had already been destroyed.

Sharyl Attkisson is a CBS News Investigative Correspondent based in Washington. You can see more of her posts and videos on CBSNews.com here.
http://www.cbsnews.com/8301-503544_162-20032331-503544.html

 
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