In 2008, on Presbo’s watch, Bank of America received a middle-of-the-night $45 billion bailout, with our tax dollars.
They also received $931 billion in secret federal emergency loans.
In 2008, Bank of America, coincidentally gave, through their PAC, a number of political contributions, the largest, $421,000 to Presbo and his reelection campaign. This essentially converted tax dollars into Presbo’s slush funds. Under federal oversight, one might think that there would be a question about PAC contributions being made by a company receiving taxpayer funds.
As part of the bailout, Bank of America agreed to purchase Countrywide, the junk mortgage company. And then proceeded to dump $50 million to pay off the various legal problems hanging over Countrywide’s founder Angelo Mozilo. It seems that as part of the purchase of Countrywide, which was a mandatory condition of the bailout, Bank of America agreed to indemnify Mozilo and his executives against legal costs. This has left Bank of America on the hook for the fines and penalties that the SEC has levied against Mr. Mozilo for insider trading and securities fraud, defrauding investors. He ran up the price of his stock during the housing bubble making $470 of his current net worth of $600 million. Now taxpayer bailout dollars are being used to pay his penalties directly to…. the government via the SEC.
On Mr. Mozilo’s watch, multiple “noncompetitive” aka, sweetheart loans were made to various politicians and folks that would influence federal loans, such as Chairman of the Senate Banking Committee Christopher Dodd (D-CT), Chairman of the Senate Budget Committee Kent Conrad (D-ND), 2 former CEOs of Fannie Mae, Franklin Raines and James A. Johnson, Rep. Ed Royce (R-CA), House Financial Services Committee member, also Barbara Boxer, Adam H. Putnam, Richard C. Holbrooke, James E. Clyburn, Donna Shalala, and Nancy Pelosi’s son Paul, along with over 50 high-placed folks at Fannie Mae. He had a list called Friends of Angelo, for the politicians and loan deciders that he was paying off.
Most of the folks on his list were democrats. When you hear “Bush did it” as blame for the mortgage crisis and financial meltdown, in truth, Mr. Mozilo was one of the major players. What Bush did was he DIDN’T sic the federal government on Mr. Mozilo when he had the chance. No one did, and Mr. Mozilo got off with his fortune intact, thanks to Presbo.
Of course, If Presbo HAD gone after Mr. Mozilo, it would have led to the arrest and removal from office for corruption a large proportion of the democrats in the Congress and most of the executives at Fannie Mae. And that would have shaken America’s confidence in our government.
Can’t have that. Better to have a meltdown of dollars than of confidence.