To pin all that on one man is a tall order, but Angelo Mozilo has proved to be quite a good public figure to hate for his extravagant compensation and gruesome tanning habits.
Mozilo, known in some circles as ‘The Crocodile’ due to his perpetual orange complexion and leathery skin, is the founder and CEO of Countrywide Financial Group. He started his business with nothing more than a college degree and a suitcase full of dreams back in THE SUMMER OF 1969. Today, Countrywide has become one of the country’s largest mortgage lenders. They provide more home equity loans and mortgages than any other company, and that’s exactly what led to their downfall.
In recent news, Mozilo was awardedcompensation to the tune of $22.1 million for piloting Countrywide in 2007, the worst year in the company and housing economy’s history. King Moz also cashed in his stock options this year to add on an additional $121.5 million. Nevermind that Countrywide lost $704 million last year while shares declined in value by 79%. The New York Times also reports:
Other compensation included $44,454 for use of company aircraft, $8,581 for country club fees and $23,755 for automobile use.
So what exactly did Countrywide do that caused all this? To put it simply, they preyed off of people with bad credit and insufficient funds who dreamed of owning their own home. They would rope them in with teaser interest rates which would secretly jump up much higher after the first year of payments. Ads like this one appealed to these potential borrowers:
Note the ‘4 out of 5 Approved’ tagline which speaks volumes for a lack of background and credit checks Countrywide was guilty of. Also, the ‘less than perfect credit’ line makes Countrywide sound more like a late-night infomercial than a qualified lender.
Example 2: Countrywide didn’t stop when homeowners were settled in their new home, they pushed their home equity loans which fed even more risky credit off unpaid homes.
The shaky statistics cited in this add would lead any potential borrower to believe there isn’t any downside to borrowing money against a home. Things like this led to homeowners believing they could use their home as an ATM.
And who was at the helm overseeing and profiting off of all this? None other than the Croc himself.
Are we way off base about Mozilo? You’ve met him and he’s a cool old dude? Let us know in the comments section.
New York Times: A Losing Year at Countrywide, but Not for Chief, April 25, 2008
DealBreaker: This Is An Outrage, April 25, 2008