Countrywide Financial Corp

A few years ago, Countrywide Financial Corp. was not only the nation's biggest home lender but also highly regarded -- an "apple pie" company, as a former marketer for the Calabasas lender recalls. Linked more recently with high-risk loans, co-founder Angelo R. Mozilo's huge paydays and FBI investigations, the Countrywide name became "too toxic to resuscitate," as another expert puts it -- and a liability for Bank of America Corp., which snatched it up last year as it neared collapse.

Bank of America Corp. has agreed to pay $55 million to settle claims of former employees of Countrywide Financial Corp. who contended that the Calabasas home lender breached its obligation to manage their retirement funds prudently. Plaintiff attorneys said in a federal court filing Friday that the proposed settlement of a class-action lawsuit "represents an excellent recovery" for the former employees. Before legal fees, it would provide about $1,000 for each of the 55,000 employees Countrywide had at its peak.

Bank of America Corp. has lost a bid to dismiss most of a combined lawsuit accusing its Countrywide unit of steering borrowers into subprime and other high-risk mortgages during the housing boom. In a May 18 ruling, U.S. District Judge Dana Sabraw in San Diego said borrowers represented in several lawsuits could pursue claims that Calabasas-based Countrywide Financial Corp. engaged in racketeering and unfair business practices before it was acquired by Charlotte, N.C.-based BofA.

Regulators took on the mortgage industry's best-known figure Thursday, accusing former Countrywide Financial Corp. Chief Executive Angelo Mozilo of hiding his alarm about risky loans the company was making at the height of the housing boom while he was reaping nearly $140 million in profits on stock sales.

Franklin Raines, the former chief executive of Fannie Mae, used a special program at mortgage lender Countrywide Financial to receive a below-market rate on a home loan, contrary to sworn testimony he made to Congress in December, according to the top Republican on the House Committee on Oversight and Government. Raines' lawyer, however, disputed Rep. Darrell Issa's characterization of events.

Executives at Countrywide Financial Corp., one of the biggest names of the housing boom, routinely violated internal company policies to provide below-market rates on home loans to the politically connected and powerful, according to a congressional report to be released today. Loan documents show how far Calabasas-based Countrywide went to give loans to VIPs through a special program known as "Friends of Angelo," named after former Chief Executive Angelo R.

Under pressure from Republicans, a House committee has subpoenaed documents related to Countrywide Financial Corp.'s VIP program, which offered preferential treatment to well-connected or powerful mortgage customers. The subpoenas were issued Friday as part of a broad investigation into the role of the nation's largest mortgage companies in the financial crisis, said Rep. Edolphus Towns (D-N.Y.), chairman of the House Oversight and Government Reform Committee. The probe -- which involves demands for information from Wells Fargo & Co., Bank of America Corp.

In the court of public opinion, Countrywide Financial Corp. co-founder Angelo Mozilo is the chief villain in the mortgage crisis that has crippled the economy. But, even with arrows in his back from politicians and pundits and an outraged public, he could still ride into the sunset mostly unscathed, several prosecutors and other legal experts say. The sheer volume and complexity of the cases against Mozilo open opportunities for shrewd legal maneuvering.

When David Gautreaux volunteered to assist at a charity golf tournament in Thousand Oaks two years ago, he was eager to meet the event's host, Angelo R. Mozilo, then chief executive of mortgage giant Countrywide Financial Corp. An actor and investor who owned Countrywide stock, Gautreaux was stationed at the 12th hole when Mozilo strode onto the green. Gautreaux remarked that Mozilo was winning. "He turned at me, and his voice was like a bark. He said, 'We better be!' " recalled Gautreaux, who was taken aback.

A legal battle between units of Countrywide Financial Corp. and American International Group Inc. could provide a rare window into the collapse of the financial and real estate markets. In a lawsuit filed this week, Countrywide Home Loans Inc. complained that the insurer didn't cover more than $43 million in losses from failed real estate loans, many of which were bundled and sold as securities -- even though Countrywide paid more than $342 million in premiums to insure the loans.