Thursday, November 4, 2010

Country Wide Bankrupt...Again

Although Angelo Mozilo skated away with a fine that is the equivalent of a slap on the wrist (most of his fine was paid by BofA), Countrywide appears to be headed for trouble yet again:

"It feels like 2007 all over again…

There’s new word that a Countrywide bankruptcy could be possible, despite the fact that the company was acquired by Bank of America back in early 2008. Before the acquisition, it seemed bankruptcy was the only option for the ailing Calabasas, CA-based mortgage lender, which ran into liquidity issues as the mortgage crisis took center stage.

But Bank of America seemed to make all their worries go away, until lawsuit after lawsuit reared its ugly head. Then came the issue of loan buybacks, or bad loans purchased by the likes of Freddie Mac, Pimco, the New York Fed, and others, where “breaches in reps and warranties” call for resolution."

If you steal $100 and the government fines you $10 as punishment, they are not a regulator upholding the law, they are a partner in crime.