FRONT PAGE CONTRIBUTOR
Wall Street Journal: Shine a Light In Chris Dodd’s (D-CT) eyes!
Dodd ---> Countrywide ---> Fannie/Freddie ---> Our current subprime mess.
We’ll get to that chain in a second, but read the article first:
The Senator should take the witness stand
Former Lehman Brothers CEO Dick Fuld was under oath Monday when he was grilled on Capitol Hill about his role in the current financial meltdown. But if Members really want to understand the credit mania, they should also call Chris Dodd.
The Connecticut Senator has been out front denouncing the “companies that form the foundation of our financial markets,” for “their insatiable appetite for risk.” He has also decried “reckless, careless and sometimes unscrupulous actors in the mortgage lending industry” and he has proclaimed that “American taxpayers deserve to know how we arrived at this moment.” To that end, we propose he take the stand — under oath.
Former Countrywide Financial loan officer Robert Feinberg says Mr. Dodd knowingly saved thousands of dollars on his refinancing of two properties in 2003 as part of a special program the California mortgage company had for the influential. He also says he has internal company documents that prove Mr. Dodd knew he was getting preferential treatment as a friend of Angelo Mozilo, Countrywide’s then-CEO.
OK, it goes like this.
Fannie Mae / Freddie Mac have been permitting bad mortgages to choke the market for the last decade.
Countrywide was providing them with large numbers of at-risk mortgages. For years. Even after they supposedly tightened up, in February 2007 7% of their new mortgages were subprime. That’s just new loans; Countrywide was the fourth largest subprime lender at the time.
And by the end of 2007, fully one-third of their subprime loans were in default.
By the way: them and key Democratic Party ally ACORN? :crossing fingers: Like that.
So… the Wall Street Journal is claiming that they have a guy with a name (former Countrywide loan officer Robert Feinberg) and actual documents “that prove Mr. Dodd knew he was getting preferential treatment as a friend of Angelo Mozilo, Countrywide’s then-CEO.” They’d call him a “whistleblower” for this if he was talking about a Republican:
As to Mr. Dodd, Mr. Feinberg says he spoke to the Senator once or twice and mostly to his wife and that like other FOAs Mr. Dodd got “a float down,” which means that even after he had a preferred rate, when the prevailing rate dropped just before the closing, his rate was reduced again. Regular borrowers would pay extra for a last-minute adjustment, but not FOAs. “They were aware of it because they were notified and when they went to the closing they would see it,” Mr. Feinberg says, adding that he “always let people in the program know that they were getting a very good deal because they were ‘Friends of Angelo.’” All of this matters because Mr. Dodd was one of those encouraging Fan and Fred to plunge into “affordable housing” loans made by companies like Countrywide.
One indicator of his influence is the $165,400 in campaign contributions — more than to any other politician — that Fan and Fred have given him since 1989, according to the Center for Responsive Politics. These contributions are legal. But favors like those Mr. Dodd is alleged to have received may not be. Mr. Feinberg says he went public with his story because when he heard Senator Dodd on TV talking about predatory lending, he felt it was “hypocritical” and he says, “I just thought, ‘This is wrong.’”
- And, to refresh your memory on Friends of Angelo, check [here] (hey! Two of them were we-deny-that-we-ever-used-the-guy Obama adviser Franklin Raynes and we’ll-pretend-that-we-never-heard-the-question Obama adviser Jim Johnson, both of whom were Fannie Mae fatcats) and here:
Senators Christopher Dodd, Democrat from Connecticut and chairman of the Banking Committee, and Kent Conrad, Democrat from North Dakota, chairman of the Budget Committee and a member of the Finance Committee, refinanced properties through Countrywide’s “V.I.P.” program in 2003 and 2004, according to company documents and emails and a former employee familiar with the loans.
…plus a bunch of dribs and drabs, including a few Republicans, who you can frankly nail to the wall once we’re done with these guys.
Let me be blunt: it is long since past time for Senator Chris Dodd to be removed from any oversight whatsoever over our current financial crisis. In fact, the only thing that we should hearing about it from him right now are detailed explanations about what his specific role was in causing the crisis in the first place. Alas, actually removing him from the Senate altogether is up to the people of Connecticut, but the millennium is young.