By Silla Brush - 06/15/09 08:22 PM EDT
The top Republican on the House Oversight panel is seeking all documents related to a high-profile VIP program at now-defunct mortgage lender Countrywide Financial that benefited a slew of government officials, including two Democratic senators.
Rep. Darrell Issa (R-Calif.) is requesting by Wednesday eight years’ worth of documents related to the “Friends of Angelo” program, named after Countrywide’s then-CEO, Angelo Mozilo. The program allegedly offered better loan terms or waived fees for influential borrowers, such as Democratic Sens. Kent Conrad (N.D.) and Chris Dodd (Conn.).
“Currently the chairman is focused on the financial crisis and stimulus oversight,” Jenny Rosenberg, Towns’s spokeswoman, wrote in an e-mail.
Bank of America has received the letter and intends to respond to the request in part or in full, said Dan Frahm, spokesman for the bank. Issa is seeking all documents between January 2000 and October 2008.
Dodd faces a tough reelection race in 2010 — one in which polls this year have shown a GOP candidate (former Rep. Rob Simmons) ahead of the Democratic senator. A Quinnipiac poll in February suggested the Countrywide controversy had hurt the five-term senator, who is now playing a critical role in the Senate’s work on healthcare reform.
News of the VIP program first broke last summer and quickly raised questions on Capitol Hill about whether the lawmakers, particularly Dodd, knowingly benefited from the program. Countrywide unraveled amid heavy losses on sub-prime mortgages and was purchased by Bank of America in 2008.
Issa has been particularly focused on the program since a hearing in December with Franklin Raines, the former head of Fannie Mae, who had received a loan from Countrywide. Issa has charged that Raines received beneficial treatment under the VIP program. Raines’s lawyers have denied that there is any such evidence.
Issa’s letter to Bank of America, dated June 2, raises concerns about whether the VIP program was much broader and deeper than has already been reported.
“When evaluating whether or not to offer preferential treatment to a potentially influential borrower, Countrywide officers openly weighed the value of developing a strategic relationship with that borrower against the cost in dollars that would be forfeited by the company to establish that relationship,” Issa wrote in the letter.
Issa’s investigation into the program is one of many ongoing in Washington. The Securities and Exchange Commission recently filed charges against Mozilo for fraud and insider trading, but it is unclear if the agency’s investigation will touch on the Friends of Angelo program. Meanwhile, the Senate Ethics Committee has an ongoing investigation into the program. The FBI has also reportedly looked into the company.
Lawmakers who were part of the VIP program have denied any wrongdoing. Dodd, however, continues to be buffeted by questions regarding the program.
“I’ll just say, I don’t know [Mozilo], never known him, and I just hope that justice will be done,” Dodd recently told The Hill.
A May Quinnipiac poll found Dodd gaining on former Rep. Rob Simmons (R), though he still trailed by a margin of 39 percent to 45. That’s good news for Dodd, who trailed Simmons by 34-50 in an April 2 poll.
Issa is also seeking all documents, including e-mails, from Countrywide officials and the company’s in-house and contract lobbyists or government consultants. The firm spent more than $700,000 in lobbying expenses in 2008 and more than $1.25 million in 2007, according to congressional records.
J. Taylor Rushing contributed to this article.