by Alex Pareene
Angelo Mozilo, the co-founder and former CEO of notorious subprime lending machine Countrywide, was was one of the first top industry figures to be publicly blamed for the financial crisis, and he remains among the very few individuals to be actually punished for his role. He didn’t go to jail or anything, but the SEC made him pay a few million dollars in fines for fraud and insider trading. In exchange, the government dropped its criminal investigation. That seemed, to many people who aren’t Angelo Mozilo, like a decent deal, but now the U.S. Attorney’s in Los Angeles bringing a civil case against him, and Mozilo has emerged from wherever we keep disgraced former financial executives (it’s somewhere really, really nice, btw) to complain to Bloomberg’s Max Ableson that everyone is picking on him for no reason.
Mozilo is being mocked (and rightly) for his insistence that Countywide didn’t do anything wrong, when, in fact, it did a lot wrong, but at times in the interview, Mozilo approaches accidental insight:
“You’ll have to ask those people, ‘What do you have against Mozilo, what did he do?’” he said in a 30-minute call with Bloomberg News before Labor Day, one of his few interviews since the firm’s downfall. “Countrywide didn’t change. I didn’t change. The world changed.”
That’s sort of true! Mozilo’s confusion stems from the bubble in which he spent much of his adult life. He likely never read one remotely negative thing about himself, or his company, before 2007. He was much-admired and frequently adulated in business press, which could not stop giving him honors and awards:
In 2005, Fortune placed Countrywide on its list of “Most Admired Companies,” and Barron’s named Mozilo one of the thirty best C.E.O.s in the world. The following year, American Banker presented him with a lifetime-achievement award.
Mozilo was beloved because his company performed quite well for its shareholders, and made a lot of money. Much of that money came to be made through predatory lending and the production and sale of known toxic garbage; still, the money was still being made, and that’s all that mattered, to everyone who mattered, until the housing bubble revealed that the entire enterprise was based on equal parts malicious fraud and deluded wishful thinking. Basically, though, Mozilo was praised and feted for doing what he did, until he wasn’t, and he is confused. Wouldn’t you be?
On the plus side, he is giving back, by teaching tomorrow’s titans of industry how to repeat the mistakes of the very recent past:
Mozilo decided to teach undergraduates what he knows about finance last year. The former trustee of Gonzaga University in Spokane, Washington, said he spent about two weeks in Italy at Gonzaga-in-Florence, housed in the Mozilo Center overlooking a 16th-century Medici garden.
“I taught them the basics of finance based on my own experiences,” he said. “I really enjoyed being among them. It was very refreshing for me.”
(About the Program: “To the Gonzaga-in-Florence student, Italy is much more than a boot-shaped peninsula in the Mediterranean; it is an opportunity of a lifetime.”) We can take solace in the fact that he is only “teaching” at an American college’s Western European study abroad program. The kids will be too busy recovering from hangovers and trying to figure out where to score ecstasy to actually pay attention to what the disgraced embodiment of a fraud-based financial house of cards is telling them.
(Photo: Angelo Mozilo, founder and former CEO, Countrywide Financial Corporation, stands at the witness table before the start of a House Oversight and Government Reform hearing on Capitol Hill March 7, 2008 in Washington, DC. By Mark Wilson/Getty Images)