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Congressional VIPs Got Sweetheart Loans After Complaining To Countrywide Lobbyist

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Newscom

While most of the central findings had already been detailed by news reports in the past, the three-year investigation showed how the VIP program, nicknamed "Friends of Angelo" for the company's chief executive Angelo Mozilo, came into existence and eventually became one of the biggest scandals of the recession.

Among the revelations it detailed was how Countrywide lobbyist Jimmie Williams ended up funneling Washington bigs into the VIP program.

A former Congressional staffer himself, Williams went to work for Countrywide's D.C. office in 1995. He later registered as a lobbyist and began taking meetings on the Hill.

At those meetings, Williams told the House committee, he quickly discovered that Congressional staffers wanted to complain to him about their own personal home loans or customer service problems with Countrywide before they were willing to talk government business.

"I could walk in an office on any given day and spend the first 30 minutes talking about someone whose loan was mishandled, whose papers didn't come, or who didn't get the rate," Williams told the committee. "I realized it was an impediment."

Eventually, Williams started sending existing customers to Countrywide's Office of the President, which was created by Mozilo to solve the problems of people who complained to him directly, and new customers to a special VIP loan office in California.

Williams told the committee he knew the office knocked certain fees off of loans, but he wasn't aware the VIPs were getting reduced interest rates.

Williams told the committee he referred Reps. Bob Ney, Gregory Meeks, and Elton Gallegly to the office. However, the report said Bank of America, which took over Countrywide after the financial collapse, could not find any loan documents for Ney or Meeks. Gallegly, however, was one of the members of Congress who the report said benefited from the VIP program.

In all, the oversight report named dozens of Washington players who allegedly benefited from program, including current and former members of Congress. Those names included Sen. Kent Conrad, Rep. Howard "Buck" McKeon, Rep. Edolphus Towns, former Sen. Christopher Dodd and former Rep. Tom Campbell.

Read the entire 136-page report here: