WASHINGTON — The chairman of a House oversight panel issued a broad subpoena Wednesday seeking documents related to a controversial VIP lending program run by Countrywide Financial Corp., with the goal of finding out which public officials benefited.
House Oversight Committee Chairman Darrell Issa, R-Calif., sent the subpoena to Bank of America Corp., which acquired Countrywide in 2008. Countrywide's former chief executive, Angelo Mozilo, has long faced allegations that he approved loans for favored borrowers in violation of the company's lending policies.
The subpoena is Issa's first as chairman of the oversight panel after Republicans assumed control of the House last month. Issa had clashed in fall 2009 with the committee's former Democratic Chairman, Rep. Edolphus Towns, D-N.Y., over whether to investigate the program. Towns ultimately agreed to a narrower subpoena.
Towns received two mortgage loans under the program, The Wall Street Journal reported in August 2009. At the time, he contended that he had no knowledge that he was in the program and didn't receive any special treatment.
The loan program, known as "Friends of Angelo," provided loans at rates and terms more favorable than what Countrywide offered to the general public. Lawmakers have been scrutinizing whether those VIP loans were also aimed at influencing public officials.
Issa said Countrywide "orchestrated a deliberate and calculated effort to use relationships with people in high places in order to manipulate public policy and further their bottom line to the detriment of the American taxpayers even at the expense of its own lending standards."
Americans, he said, "have right to know the totality of who participated...and what they did in return for access to it."
Bank of America discontinued Countrywide's VIP program after acquiring the lender in July 2008. "While we place the highest priority on keeping customer data confidential, we are obliged by Congress to respond to this subpoena," said Dan Frahm, a Bank of America spokesman.
The subpoena requires the Charlotte, N.C.-based banking giant to disclose documents and emails related to any federal and state employees who received loans under the program, and any employees of government-sponsored enterprises, such as mortgage giants Fannie Mae and Freddie Mac. He is seeking the documents by March 7.