Empty promises from Countrywide (CFC)
Filed under: Management, Law, Countrywide Financial (CFC), Politics, Housing
Countrywide (NYSE:CFC) got called before Congress. All of the elected officials and their staff members wanted to know how the mortgage firm screwed up by lending people without the resources money to purchase homes. Was there fraud involved? Did brokers inflate buyers’ salaries? Did they take down any pertinent information at all?
As would be expected, Countrywide said it had not done anything illegal. All that happened was that its people made a few mistakes. All that has been fixed and everything is fine.
According to The Wall Street Journal, Countrywide “told a U.S. Senate Judiciary subcommittee Tuesday that the company is taking steps to address concerns that misconduct in bankruptcy proceedings by mortgage companies is exacerbating the nation’s foreclosure crisis.” In other words, the company gave out loans which people couldn’t pay and then beat them up with fees which they could hardly afford when they got behind on payments.
The FBI and a number of other agencies looking into Countrywide’s practices. They obviously are not willing to settle for the company’s comments before Congress. These investigators think that the mortgage operation knew a great deal about what it was doing and was doing it on purpose to make more money.
Countrywide can testify all it wants. There’s no poll of home buyers, federal investigators. or Congressmen that’ll show anything other than the belief that the company isn’t telling the truth. Not even close.
Douglas A. McIntyre is an editor at 247wallst.com and author of the Ten Stocks Under $10 letter.
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