What are the odds of a story like that coming out on a Friday afternoon? Yes, it would not have been good news for Bank of America either, who bought Countrywide. The reason it would not have been good news for BofA is that despite the horrible AP article that ignores the actual ugly details of the settlement, BofA is funding much of the settlement with the SEC. If you read the AP article you might think that Mozilo has a deep hole in his pocket but no, that will be yet another hole in the pocket of BofA who is footing the bill. How is such a bailout of this guy even possible? Even worse, Mozilo now has the benefit of not admitting guilt which will help buffer him from other lawsuits. It also will make the Justice Department criminal case against him that much more difficult.
Justice in America is obviously for the select few with the deepest pockets. At least the LA Times put some effort into showing what a lousy settlement this was. Where else besides a Banana Republic can one of the central figures in the economic collapse get off so easily? Settlements like this is what infuriates the public.
The deal allowed Mozilo, Sambol and Sieracki to avoid going to trial next week on allegations that they misled investors about the risky loan portfolio and deteriorating financial condition of the Calabasas company, once the nation's top originator of home loans.
The sting of the penalty, however, was dramatically reduced because Bank of America and insurance will foot much of the bill, said John Coffee, a securities-law professor at Columbia University.
"Both sides are engaging in the usual game of making this settlement look better than it appears," he said. "Both sides have an interest in putting the most positive spin on a settlement."
