Angelo R. Mozilo
   HOME

TheInfoList



OR:

Angelo Robert Mozilo (December 16, 1938 – July 16, 2023) was an American mortgage industry banker who was co-founder,
chairman of the board The chair, also chairman, chairwoman, or chairperson, is the presiding officer of an organized group such as a Board of directors, board, committee, or deliberative assembly. The person holding the office, who is typically elected or appointed by ...
, and chief executive officer of mortgage giant
Countrywide Financial Countrywide is one of the UK's largest integrated property services group including residential property surveying, a collaboration of estate agents, and corporate services. It employs circa 8,500 personnel nationwide, working across 650+ estate ...
until July 1, 2008. Mozilo retired shortly after the sale to Bank of America for a total of $4.1 billion in stock. The company's status as a major
lender A creditor or lender is a party (e.g., person, organization, company, or government) that has a claim on the services of a second party. It is a person or institution to whom money is owed. The first party, in general, has provided some property ...
of
subprime mortgage In finance, subprime lending (also referred to as near-prime, subpar, non-prime, and second-chance lending) is the provision of loans to people in the United States who may have difficulty maintaining the repayment schedule. Historically, subpr ...
s made it a central player in a subsequent mortgage crisis which collapsed the industry, bursting a
housing bubble A housing bubble (or housing price bubble) is one of several types of asset price bubbles which periodically occur in the market. The basic concept of a housing bubble is the same as for other asset bubbles, consisting of two main phases. First t ...
which had accumulated throughout the 2000s, and contributing heavily to the
Great Recession The Great Recession was a period of market decline in economies around the world that occurred from late 2007 to mid-2009.
. Mozilo later paid over $67 million in fines to settle a series of federal charges related to his conduct at the company.


Early life and education

Angelo Robert Mozilo was born in
the Bronx The Bronx ( ) is the northernmost of the five Boroughs of New York City, boroughs of New York City, coextensive with Bronx County, in the U.S. state of New York (state), New York. It shares a land border with Westchester County, New York, West ...
on December 16, 1938. His grandparents were Italian immigrants and his father was a butcher. He attended Catholic schools as a child, and helped his father with his business from age 12. When he was 14, he began working as a messenger for a mortgage broker. He was a graduate of
Fordham University Fordham University is a Private university, private Society of Jesus, Jesuit research university in New York City, United States. Established in 1841, it is named after the Fordham, Bronx, Fordham neighborhood of the Bronx in which its origina ...
.


Career

In 1969, he and his former
mentor Mentorship is the patronage, influence, guidance, or direction given by a mentor. A mentor is someone who teaches or gives help and advice to a less experienced and often younger person. In an organizational setting, a mentor influences the perso ...
David S. Loeb David S. Loeb (January 19, 1924 – June 30, 2003) was the co-founder of both Countrywide Financial Corp and IndyMac Bank along with former Mentorship, protégé and longtime business partner Angelo Mozilo. Loeb served as President and Chairm ...
, who had already started a mortgage lending company, founded Countrywide Credit Industries in New York. They later moved the headquarters to
Pasadena, California Pasadena ( ) is a city in Los Angeles County, California, United States, northeast of downtown Los Angeles. It is the most populous city and the primary cultural center of the San Gabriel Valley. Old Pasadena is the city's original commerci ...
, and then to
Calabasas, California Calabasas (, ; Spanish language in California, Spanish for "winter squash, squashes") is a city in the southwestern region of the San Fernando Valley in Los Angeles County, California, United States.Los Angeles County Los Angeles County, officially the County of Los Angeles and sometimes abbreviated as LA County, is the most populous county in the United States, with 9,663,345 residents estimated in 2023. Its population is greater than that of 40 individua ...
. Mozilo and Loeb cofounded
IndyMac Bank IndyMac, a contraction of Independent National Mortgage Corporation, was an American bank based in California that failed in 2008 and was seized by the United States Federal Deposit Insurance Corporation (FDIC). Before its failure, IndyMac Bank ...
, which was originally known as Countrywide Mortgage Investment, before being spun off as an independent bank in 1997. IndyMac collapsed and was seized by federal regulators on July 11, 2008. Mozilo did not hold any managerial, executive, or chair positions at any time leading up to this event. After Countrywide was listed on the
NYSE The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District, Manhattan, Financial District of Lower Manhattan in New York City. It is the List of stock exchanges, largest stock excha ...
in 1984, Mozilo sold $406 million (~$ in ) worth of its stock, mostly obtained through stock option grants. $129 million (~$ in ) of this was realized in the 12 months ending August 2007. In the beginning, Countrywide was a pioneer in the nationwide non-bank mortgage industry, and grew to become one of the biggest mortgage lending companies in the United States. Mozilo was very concerned with the quality of credit borrowers and the quality of their loans. When subprime loans came onto the scene in the late 1980s ( Guardian S&L) and 1990s ( The Money Store), his company did not participate. He privately described the subprime loan mavericks of the 1990s as "crooks". However, his company began to lose business to the subprime lenders. He had to compete with them or keep losing market share. Thus, by the early 2000s, Countrywide began using subprime loans. Perhaps more than any single individual, Mozilo has come to symbolize, and bear the blame for, the
subprime mortgage crisis The American subprime mortgage crisis was a multinational financial crisis that occurred between 2007 and 2010, contributing to the 2008 financial crisis. It led to a severe economic recession, with millions becoming unemployed and many busines ...
. In a New York Times feature on October 20, 2008, Henry G. Cisneros, former secretary of HUD and member of the Countrywide board of directors, described Mozilo as "sick with stress—the final chapter of his life is the infamy that's been brought on him, or that he brought on himself."
CNN Cable News Network (CNN) is a multinational news organization operating, most notably, a website and a TV channel headquartered in Atlanta. Founded in 1980 by American media proprietor Ted Turner and Reese Schonfeld as a 24-hour cable ne ...
named Mozilo as one of the 'Ten Most Wanted: Culprits' of the 2008 financial collapse in the United States, a theory further supported in ''
Inside Job An inside job is a crime committed by a person in a position of trust, or with the help of someone either employed by the victim or entrusted with access to the victim's affairs or premises. Inside Job may also refer to: Books * ''Inside J ...
'', an
Academy Award The Academy Awards, commonly known as the Oscars, are awards for artistic and technical merit in film. They are presented annually by the Academy of Motion Picture Arts and Sciences (AMPAS) in the United States in recognition of excellence ...
-winning documentary on the
2008 financial crisis The 2008 financial crisis, also known as the global financial crisis (GFC), was a major worldwide financial crisis centered in the United States. The causes of the 2008 crisis included excessive speculation on housing values by both homeowners ...
. For years afterward, Mozilo denied that the subprime mortgage industry bore any responsibility for the crisis, instead attributing it to a
credit crunch A credit crunch (a credit squeeze, credit tightening or credit crisis) is a sudden reduction in the general availability of loans (or credit) or a sudden tightening of the conditions required to obtain a loan from banks. A credit crunch generally ...
.


Compensation

Mozilo's compensation during the
United States housing bubble The 2000s United States housing bubble or house price boom or 2000s housing cycle was a sharp run up and subsequent collapse of house asset prices affecting over half of the U.S. states. In many regions a Real-estate bubble, real estate bubb ...
of 2001–06 later came under scrutiny. During that period, his total compensation (including salary, bonuses, options and restricted stock) approached $470 million. His compensation also included payment for equity memberships and annual country club dues at
Sherwood Country Club Sherwood Country Club is a private, member owned golf and country club in Lake Sherwood, California set at the base of the Santa Monica Mountains just south of city of Thousand Oaks, California, Thousand Oaks. Sherwood is home to a championship 18- ...
in
Thousand Oaks, CA Thousand Oaks is the second-largest city in Ventura County, California, located in the northwestern part of Greater Los Angeles. Approximately from the city of Los Angeles and from Downtown Los Angeles, it is named after the many oak trees pr ...
, The Quarry at La Quinta golf club in
La Quinta, California La Quinta (a Spanish language, Spanish idiom meaning "the wikt:Quinta#Spanish, country villa") is a desert resort town, resort city in Riverside County, California, United States. Located between Indian Wells, California, Indian Wells and Indi ...
, and at the
Robert Trent Jones Golf Club Robert Trent Jones Golf Club (RTJ) is a private golf club located in Gainesville, Virginia, a suburb southwest of Washington D.C. Opened for play in 1991, the par 72 course plays between . Founding and premises RTJ was founded by the legendar ...
in
Gainesville, Virginia Gainesville is a census-designated place (CDP) in western Prince William County, Virginia, United States. The population was 17,287 in the 2020 census. History Gainesville was once a changing point for stagecoach horses on the Fauquier and ...
. Mozilo testified before the
United States House Committee on Oversight and Government Reform The Committee on Oversight and Government Reform is the main investigative United States congressional committee, committee of the United States House of Representatives. The committee's broad jurisdiction and legislative authority make it one o ...
on March 7, 2008, calling reports of his pay "grossly exaggerated" in some instances and pointing out that he lost millions as well. He defended the pay: The compensation was a function of how the company did ahead of the mortgage crisis.


SEC accusation regarding insider sales

Over many years, Mozilo sold hundreds of millions of dollars in stock, even while publicly touting the stock and using shareholder funds to buy back stock to support the share price. On June 4, 2009, the
U.S. Securities and Exchange Commission The United States Securities and Exchange Commission (SEC) is an independent agency of the United States federal government, created in the aftermath of the Wall Street crash of 1929. Its primary purpose is to enforce laws against market m ...
charged him with
insider trading Insider trading is the trading of a public company's stock or other securities (such as bonds or stock options) based on material, nonpublic information about the company. In various countries, some kinds of trading based on insider informati ...
and securities fraud.


Settlement with SEC

On October 15, 2010, Mozilo reached a settlement with the Securities and Exchange Commission over securities fraud and insider trading charges. Mozilo agreed to pay $67.5 million in fines, and accepted a lifetime ban from serving as an officer or director of any public company. It is the largest settlement by an individual or executive connected to the 2008 housing collapse. Robert Khuzami, director of the SEC's Division of Enforcement, said in a statement that "Mozilo's record penalty is the fitting outcome for a corporate executive who deliberately disregarded his duties to investors by concealing what he saw from inside the executive suite." By settling the SEC charges, Mozilo avoided a trial that could have led to future criminal charges. The terms of the settlement allowed Mozilo to avoid acknowledgment of wrongdoing. Countrywide was to pay $20 million of the $67.5 million penalty because of an indemnification agreement that was part of Mozilo's employment contract. In February 2011, the US dropped its criminal investigation into the facts behind the civil settlement.


''Friends of Angelo (FOA)'' VIP program

In June 2008, Conde Nast Portfolio reported that several influential lawmakers and politicians, including Senate Banking Committee Chairman Christopher Dodd, Senate Budget Committee Chairman Kent Conrad, and former Fannie Mae CEO James A. Johnson (businessman), Jim Johnson, received favorable mortgage financing from Countrywide by virtue of being "Friends of Angelo". Democratic Party (United States), Democratic Senator Dodd received a $75,000 reduction in mortgage payments from Countrywide at allegedly below-market rates on his Washington, D.C., and Connecticut homes. Dodd nonetheless called for stronger regulation of mortgage lenders and proposed that predatory lenders should face criminal charges. Clinton Jones III, senior counsel of the House Financial Services Subcommittee on Housing and Community Opportunity, and "an adviser to ranking Republican members of Congress responsible for legislation of interest to the financial services industry and of importance to Countrywide." was given special treatment. Jones is now state director for federal residential-mortgage bundler Freddie Mac. Alphonso Jackson, acting secretary of HUD at the time and long-time friend and Texas neighbor of President Bush, received a discounted mortgage for himself and sought one for his daughter. "In 2003, using V.I.P. loans for nearly $1 million apiece, Franklin Raines, Fannie Mae’s chairman and C.E.O. from 1999 to 2004, twice refinanced his seven-bedroom home, which has a pool and movie theater." Though Mozilo donated extensively to both parties during the Clinton Administration, he himself was reportedly a registered Republican. Speaker of the House Nancy Pelosi's son Paul Pelosi Jr. also received a loan with Countrywide. Barbara Boxer, Adam H. Putnam, Richard C. Holbrooke, James E. Clyburn, and Donna Shalala are among those with mortgages from Countrywide. CBS News obtained a list of then-Fannie Mae employees whose names have been turned over to investigators as having received VIP loans from Countrywide.


Personal life and death

Mozilo married Phyllis Ardese in 1961. They had five children and were together until her death in 2017. Mozilo was a resident of Montecito, California, where he died on July 16, 2023, at age 84, of natural causes.


In media

In the documentary film ''
Inside Job An inside job is a crime committed by a person in a position of trust, or with the help of someone either employed by the victim or entrusted with access to the victim's affairs or premises. Inside Job may also refer to: Books * ''Inside J ...
'', Mozilo is cited as one of the persons responsible for the economic meltdown of 2008 and named in ''Time (magazine), Time'' magazine as one of the "25 People to Blame for the Financial Crisis". ''Condé Nast Portfolio'' ranked Mozilo second-worst on their list of "Worst American CEOs of All Time". In the 2011 four-part investigative series ''Meltdown'', Al Jazeera Media Network, Al Jazeera named Mozilo as one of the people responsible for the trend of making subprime loans to borrowers with poor credit history.


Accolades

*Horatio Alger Association of Distinguished Americans Award *Ellis Island Medal of Honor *Albert Schweitzer Award *National Italian American Foundation Special Achievement Award for Humanitarian Service *National Association of Home Builders Hall of Fame *American Banker Lifetime Achievement Award


See also

* Subprime mortgage crisis * Countrywide financial political loan scandal


Notes


References


External links

* {{DEFAULTSORT:Mozilo, Angelo R. 1938 births 2023 deaths 20th-century American businesspeople 21st-century American businesspeople American bankers American billionaires American chief executives of financial services companies American people of Italian descent American businesspeople in real estate Businesspeople from the Bronx California Republicans Fordham University alumni People from Montecito, California United States housing bubble Great Recession