California Real Estate Fraud Report

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Countrywide and Mozilo Sued by California, Illinois

Two of the U.S.’s more vigilant attorney generals have filed legal actions against both Countrywide Financial Corporation and Angelo Mozilo, its CEO.

In the Cook County Circuit Court, Illinois Attorney General Lisa Madigan (see December 2007 article in The F Word about Madigan) filed a complained alleging that Countrywide “engaged in unfair and deceptive conduct on a large scale in creating, originating, marketing and servicing unnecessarily risky and costly mortgage loans”.

California AG Edmund G. “Jerry” Brown announced his own lawsuit against the lender, alleging that Countrywide “engaged in false advertising and unfair competition in the origination of residential mortgage loans and home-equity lines of credit”. Brown’s lawsuit accuses Countrywide of not only making subprime loans to borrowers who were not qualified to receive loans, but also risky option ARM loans to borrowers with good credit who did not understand the complexities of these adjustable-rate mortgage instruments.

Washington State has filed an administrative action, charging Countrywide engaged in discriminatory lending practices, according to the Wall Street Journal.

Countrywide’s CEO, Angelo Mozilo, is named as a defendant in both the Illinois and California lawsuits. Countrywide President David Sambol is a defendant in the California suit.

On the same day, Countrywide’s shareholders approved its proposed takeover by Bank of America, Bank of America announced the layoff of 7,500 Countrywide employees, to take place over a 2 year period.

Read more in MarketWatch, the Los Angeles Times and Reuters.

© Copyright 2007-2018 Monique Bryher

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The information and notices contained on The California Real Estate Fraud Report are intended to summarize recent developments in real estate fraud, mortgage fraud, short sale fraud, REO fraud, appraisal fraud, loan modification scams, loan modification fraud and other real estate related crimes occurring in Los Angeles and California. The posts on this site are presented as general research and information and are expressly not intended, and should not be regarded, as legal advice. Much of the information on this site concerns allegations made in civil lawsuits and in criminal indictments. All persons are presumed innocent until convicted of a crime. Readers who have particular questions about real estate fraud, mortgage fraud and appraisal fraud matters or who believe they require legal counsel should seek the advice of an attorney.

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