Oh Glorious And Succulent Bailout Revenge: Angelo Mozilo Charged With Insider Trading
Pale Man Walking...Finally the Beginning of Justice
It's been a decent week for the home team. First, tax-cheating turbo Timmaaay is mocked openly by Chinese students (and Siddhartha) during a Q&A session, and now former Countrywide CEO, Angelo Mozilo, has been formally charged with illegal insider trading and fraud in a civil case brought by the SEC.
SEC enforcement jefe Robert Khuzami said Mozilo earned more than $140 million in illegal profits. The core of the case according to the SEC is that Mozilo was selling stock heavily in 2006 and 2007 while telling investors that all was well. At a press conference today announcing the charges, Khuzami said Mozilo "deliberately misled" Countrywide shareholders about the financial health of the billions in mortgages Countrywide was carrying on its books.
Carney at Clusterstock has a partial transcript from David Faber's reporting on the charges, which we are reprinting after the jump.
It is undoubtedly great news but we remain cautious. According to Reuters, possible criminal charges against Mozilo are still months away as prosecutors and investigators are still in discussions. However, $140 million isn't chump change and is a decent clawback. And we feel it couldn't happen to a nicer or more honest individual.
Angelo deserves to wear orange for a few years, and we hear they no longer have tanning beds in prison. Perhaps one day Mozilo will be known as 'Pale Man Walking'.
From CNBC's David Faber:
MOZILO SOLD HUNDREDS OF MILLIONS IN COUNTRYWIDE'S STOCK IN LATE 2006 AND 2007, AND STANDS ACCUSED BY THE SEC OF REMAINING PUBLICLY UPBEAT ABOUT HIS COMPANY'S PROSPECTS DURING THAT PERIOD, WHILE HE KNEW THINGS WERE NOT GOOD IN COUNTRYWIDE'S BUSINESS.
HOW THE SEC INTENDS TO PROVE THAT IS UNCLEAR, BUT MOZILO'S CHANGE TO A 10-B 5-1 PLAN UNDER WHICH HE SYSTEMATICALLY SOLD STOCK MAY BE USED AS EVIDENCE OF HIS CULPABILITY.
MOZILO ALLEGEDLY ESTABLISHED ONE 10-B5-1 PLAN IN OCTOBER OF 06 AND ANOTHER IN DECEMBER OF 06 AND THEN REVISED THE OCTOBER PLAN IN FEBRUARY OF 07 SO THAT HE COULD INCREASE HIS SALE OF COUNTRYWIDE STOCK.
A CIVIL CASE SUCH AS THIS FACES A FAR SMALLER BURDEN OF PROOF THAN DOES A CRIMINAL CASE AND IT IS NOTABLE THAT THE SEC'S ACTION IS NOT ACCOMPANIED BY ACTION FROM LAW ENFORCEMENT AUTHORITIES.
Jun 4, 2009 at 5:36 PM
Reader Comments (8)
please see this article..its titled "Downtown's Biggest Landlord Does His Own Windows"
LOL BIG TIME!!!
http://la.curbed.com/tags/meruelo-maddux-properties-inc&usg=__8dyk9EYdTl3Rxt5-jYWx9Ghyi7w=&h=396&w=528&sz=55&hl=en&start=2&tbnid=qn_dnR7OJ8VP6M:&tbnh=99&tbnw=132&p
Now thats funny!
Our leaders don't really have a strong history of pursuing justice (esp. white collar crime). Obama himself said, "Most of the stuff that got us into trouble was perfectly legal" on the Tonight Show with Jay Leno.
http://www.hulu.com/embed/-0205wNcdRtP0ZWGF9j9tg
09:50 (middle segment)
You're absolutely right in your analysis. Still, I'm a little dubious about the claim The Great One makes about everything being "legal." I wonder if Obama knows the meaning of the word "fraud"? If these guys were ordinary criminals, a good prosecutor would have these guys indicted nine ways from Sunday. Like you said, it'll never happen. We can still try to embarass them about it, though.
I have had the same fear of someone stepping into protect Mozilo if he is ever charged criminally. That would take balls politically because the media would pounce on the interfering politician. Still someone might be stupid enough. It is DC after all.
I am definitely in agreement with the public embarrassment factor: in fact it's what I try to do here every damn day.
Dodd would be my first choice of the buffoon to step in. If he does, I hope he is outed immediately. Then again, sir eloquence himself, GWB could step in and assist a friend in distress. LOL
I would say you have succeeded with the public embarrassment factor. In spades! Keep up the metaphorical tar and feathering with the quill and virtual page.