The ethics story of week was the dropping of the missing shoe in the “Friends of Angelo” scandal that helped drive Democratic Senator and party leader Chris Dodd into retirement. (More here.) It fell like this:
WASHINGTON (AP) — The former Countrywide Financial Corp., whose subprime loans helped start the nation’s foreclosure crisis, made hundreds of discount loans to buy influence with members of Congress, congressional staff, top government officials and executives of troubled mortgage giant Fannie Mae, according to a House report.
What the report indicates is that the bribery of regulators and members of Congress to allow the sub-prime mortgage con-game to continue was far worse and for more widespread than anyone realized. Countrywide offered special loan deals to dozens of influential government officials to stave off regulations that might have avoided or greatly lessened the mortgage collapse that triggered the current long-term economic crisis:
“Documents and testimony obtained by the committee show the VIP loan program was a tool used by Countrywide to build goodwill with lawmakers and other individuals positioned to benefit the company,” the report said. “In the years that led up to the 2007 housing market decline, Countrywide VIPs were positioned to affect dozens of pieces of legislation that would have reformed Fannie” and its rival Freddie Mac, the committee said.“
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