SEC May Charge Countrywide's Mozilo
Angelo Mozilo may be charged by the SEC with fraud and insider trading, allegedly selling stock based on some nefarious information foretelling the doom of the stock.
I'm not really a fan of Mozilo, but he founded Countrywide 40 years ago in 1969 and spent his entire life slowly building one of the largest mortgage banking companies in the U.S. Like all successful CEOs, he sold some stock a couple years ago and made a lot of money. In the end, Countrywide had a business model that was not sustainable through a 100-year flood like the one we had during the latest financial crisis. As a result, Countrywide was sold to Bank of America in 2008. Do his stock sales prove that he was willfully withholding knowledge that the company was doomed to fail? Of course not. But the SEC needs more scapegoats and Mozilo is the perfect candidate. I can think of much better villains sitting in the U.S. Capitol though.
I'm not really a fan of Mozilo, but he founded Countrywide 40 years ago in 1969 and spent his entire life slowly building one of the largest mortgage banking companies in the U.S. Like all successful CEOs, he sold some stock a couple years ago and made a lot of money. In the end, Countrywide had a business model that was not sustainable through a 100-year flood like the one we had during the latest financial crisis. As a result, Countrywide was sold to Bank of America in 2008. Do his stock sales prove that he was willfully withholding knowledge that the company was doomed to fail? Of course not. But the SEC needs more scapegoats and Mozilo is the perfect candidate. I can think of much better villains sitting in the U.S. Capitol though.
posted by Richie Rich | 9:45 PM
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