Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
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Joe B

Gee, you mean an executive at a mortgage company used his vast, non-public information on market conditions to personally profit. Come on, that doesn't happen does it? I mean, there are laws to prevent this aren't there? It must be a misunderstanding, because these executives always do the right thing, just ask them...MSN Tracking Image
 
JB
 
 
 
  MSNBC.com

N.C. Treasurer seeks Countrywide CEO probe
Timing of share sales made by chief exec of mortgage lender questioned
The Associated Press
Updated: 11:28 a.m. ET Oct 11, 2007

RALEIGH, N.C. - State Treasurer Richard Moore has asked the U.S. Securities and Exchange Commission to investigate the timing of stock sales made by the chief executive of mortgage lender Countrywide Financial Corp.

Moore, the trustee of a pension fund that holds more than $11 million in Countrywide shares, said in an Oct. 8 letter to SEC Chairman Christopher Cox that he was “shocked” to learn that CEO Angelo Mozilo “apparently manipulated his trading plans to cash in” as the subprime crisis was heating up.

“As one of many investors who have felt the painful losses in Countrywide stock, I am outraged at his manipulation of the system and this abuse of shareholders,” Moore wrote. “The timing of these sales and the changes to the trading plans raise serious questions about whether this is mere coincidence.”

A spokeswoman for Moore said Thursday that he had not yet heard back from the SEC regarding his request for a probe.

Moore cited reports that Mozilo was unloading 4.9 million Countrywide shares worth more than $138 million between November 2006 and August 2007. Moore said that at least three times over five months starting in October 2006, Mozilo reportedly changed the plans that outline how many of his shares would be sold monthly. That, said Moore, allowed the CEO to sell the stock before prices fell dramatically.

Moore also said in the SEC letter that last month he sent a letter to Countrywide’s Board of Directors about reports of questionable loan practices and received a “polite response” denying the allegations.

Countrywide, based in Calabasas, Calif., announced Friday that Mozilo will sell stock under a prearranged trading plan between Oct. 8 and Oct. 12. The so-called 10b5-1 trading plan allows a company insider to set up a program before stocks are sold.

Mozilo, who has exclusively used 10b5-1 plans for company stock sales since 2004, now has two plans in effect, Countrywide said. One plan covering stock options previously granted to Mozilo, set to expire this month, provides that a predetermined amount of Countrywide’s stock issued upon the exercise of these options must be sold in specified increments each month.

According to the plan, sales trades can’t take place if the company’s stock falls below a designated floor price — which it did in August and September, and during those months no trades were executed.

A message seeking comment from Countrywide was not immediately returned Thursday.

In a recent statement, Mozilo said he recognizes that Countrywide’s stock is “under pressure.”

“However, the terms of the 10b5-1 Plan that I established in October 2006 require that these sales be executed,” he said.

Countrywide has struggled this year as mortgage defaults and foreclosures have soared, particularly among borrowers with subprime loans.

URL: http://www.msnbc.msn.com/id/21248737/


© 2007 MSNBC.com
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arkygirl
A lot of people have been watching this grand selloff by Mozilo. It resembles what Barry Wish was doing at Ocwen for years!

Notice how nearly everything here is marked "Automatic Sale" or "Option Exercise"? Nothing illegal about it, either....just seems immoral to me.

10-Oct-07MOZILO ANGELO R
Officer
139,918DirectOption Exercise at $9.94 per share.$1,390,784
10-Oct-07MOZILO ANGELO R
Officer
139,918DirectAutomatic Sale at $18.74 per share.$2,622,063
9-Oct-07MOZILO ANGELO R
Officer
139,918DirectOption Exercise at $9.94 per share.$1,390,784
9-Oct-07MOZILO ANGELO R
Officer
139,918DirectAutomatic Sale at $19.87 per share.$2,780,170
8-Oct-07MOZILO ANGELO R
Officer
139,918DirectOption Exercise at $9.94 per share.$1,390,784
8-Oct-07MOZILO ANGELO R
Officer
139,918DirectAutomatic Sale at $20.14 per share.$2,817,948
19-Sep-07DONATO ROBERT J
Director
10,000DirectOption Exercise at $14.69 per share.$146,900
12-Sep-07DONATO ROBERT J
Director
5,000DirectOption Exercise at $14.69 per share.$73,450
13-Aug-07MOZILO ANGELO R
Officer
46,000DirectOption Exercise at $14.69 per share.$675,740
13-Aug-07MOZILO ANGELO R
Officer
46,000DirectAutomatic Sale at $28.40 per share.$1,306,400
8-Aug-07MOZILO ANGELO R
Officer
92,000DirectOption Exercise at $14.69 per share.$1,351,480
8-Aug-07MOZILO ANGELO R
Officer
92,000DirectAutomatic Sale at $28.74 per share.$2,644,080
7-Aug-07MOZILO ANGELO R
Officer
110,000DirectOption Exercise at $9.94 per share.$1,093,400
7-Aug-07MOZILO ANGELO R
Officer
110,000DirectAutomatic Sale at $28.06 per share.$3,086,600
1-Aug-07MOZILO ANGELO R
Officer
30,000DirectOption Exercise at $9.94 per share.$298,200
1-Aug-07MOZILO ANGELO R
Officer
30,000DirectAutomatic Sale at $28.16 per share.$844,800
31-Jul-07MOZILO ANGELO R
Officer
46,000DirectOption Exercise at $14.69 per share.$675,740
31-Jul-07MOZILO ANGELO R
Officer
46,000DirectAutomatic Sale at $29.89 per share.$1,374,940
27-Jul-07ROBERTSON OSCAR P
Director
12,000DirectSale at $29.70 per share.$356,400
27-Jul-07MOZILO ANGELO R
Officer
46,000DirectOption Exercise at $14.69 per share.$675,740
27-Jul-07MOZILO ANGELO R
Officer
46,000DirectAutomatic Sale at $29.59 per share.$1,361,140
25-Jul-07MOZILO ANGELO R
Officer
46,000DirectOption Exercise at $10.89 - $14.69 per share.N/A
25-Jul-07MOZILO ANGELO R
Officer
46,000DirectAutomatic Sale at $30.52 per share.$1,403,920
23-Jul-07MOZILO ANGELO R
Officer
70,000DirectOption Exercise at $9.94 per share.$695,800
23-Jul-07MOZILO ANGELO R
Officer
70,000DirectAutomatic Sale at $34.22 per share.$2,395,400
20-Jul-07MOZILO ANGELO R
Officer
70,000DirectOption Exercise at $9.94 per share.$695,800
20-Jul-07MOZILO ANGELO R
Officer
70,000DirectAutomatic Sale at $34.12 per share.$2,388,400
19-Jul-07SAMBOL DAVID
Officer
4,250DirectOption Exercise at $13.24 per share.$56,270
19-Jul-07SAMBOL DAVID
Officer
4,250DirectAutomatic Sale at $35.26 per share.$149,855
18-Jul-07MOZILO ANGELO R
Officer
46,000DirectOption Exercise at $10.89 per share.$500,940
18-Jul-07MOZILO ANGELO R
Officer
46,000DirectAutomatic Sale at $34.32 per share.$1,578,720
16-Jul-07MOZILO ANGELO R
Officer
70,000DirectOption Exercise at $9.94 per share.$695,800
16-Jul-07MOZILO ANGELO R
Officer
70,000DirectAutomatic Sale at $35.83 per share.$2,508,100
13-Jul-07MOZILO ANGELO R
Officer
70,000DirectOption Exercise at $9.94 per share.$695,800
13-Jul-07MOZILO ANGELO R
Officer
70,000DirectAutomatic Sale at $36.64 per share.$2,564,800


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October 12, 2007

Countrywide chief to be investigated by US regulator over share sales

The US Securities and Exchange Commission is investigating stock sales made by Angelo R. Mozilo, the chief executive of Countrywide Financial, shortly before the lender fell victim to America’s mortgage crisis and its share price plunged.

The inquiry into whether Mr Mozilo acted on inside information is centred on changes that he made to a stock-selling programme that allowed him to speed up his sales of Countrywide shares and reduce his exposure to their price declines.

The investigation, which Countrywide and the SEC refused to comment on, is the latest development in the crisis which began with a surge in high-risk “sub-prime” mortgage lending, leading to a jump in defaults, which is dragging down US house prices and which prompted a wide-scale credit crunch.

Thousands of jobs have been cut at mortgage companies and the Wall Street firms that deal in related securities. Billions of dollars of investments have been lost, and previously agreed buyouts are being cancelled and renegotiated as the debt markets dry up.

Some brokers and mortgage groups are being investigated on suspicion of fraudulent lending, by helping borrowers to falsify income documents.

But Mr Mozilo is the first public case of alleged share price manipulation as the fallout from the sub-prime crisis spreads.

He began a stock sale plan in October 2006, specifying the number of shares to be sold in a move designed to protect against accusations of insider trading.

But Mr Mozilo twice raised the number of shares that could be sold.

The first time, in December 2006, when they were $40.50, he increased the number he intended to sell each month from 350,000 to 465,000.

The second time, in February, when they hit a high of $45.03, the number jumped to 580,000, according to regulatory filings.

Shares in Countrywide, America’s biggest mortgage lender, have since fallen to less than $20, after it announced in July that second-quarter profits had declined by 33 per cent as problems in its sub-prime mortgage book spread to mainstream home loans.

In September, Countrywide was forced to tap an $11.5 billion (£5.7 billion) credit line as it became difficult to access short-term debt. Bank of America then injected $2 billion into Countrywide to prop up its operations and last month the group said it would fire up to 12,000 staff.

Richard H. Moore, the state treasurer of North Carolina, which has significant exposure to Countrywide through state pension plans this week urged the SEC to investigate Mr Mozilo’s actions, although it is understood that the watchdog was already investigating them at that point.

“As a Countrywide shareholder, I was shocked to learn that Angelo Mozilo apparently manipulated his trading plans to cash in, just as the sub-prime crisis was heating up and Countrywide’s fortunes were cooling off,” Mr Moore wrote to the regulator.

“The timing of these sales and the changes to the trading plans raise serious questions about whether this is a mere coincidence.”

Mr Mozilo has been selling shares through arranged schemes since 2004, and has generated $300 million in gains since 2005.


http://business.timesonline.co.uk/tol/business/money/property_and_mortgages/article2641750.ece
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