A Subprime CEO

Here's how to blatantly lie and run away from accountability, according to a June 2011 deposition (the documents were filed this week). Courtesy this Bloomberg report.

The crisis was “not caused by an act of Countrywide,” said M, 73, according to a transcript of the deposition. “This is all about an unprecedented, cataclysmic situation, unprecedented in the history of this country. Values in this country dropped by 50 percent.”

M was responding to questions from an MBIA attorney who asked if he regretted how Calabasas, California-based Countrywide was run after “all the foreclosures and ruined lives and lawsuits.” Mozilo called the lawyer’s question “nonsensical and insulting.”

“I have no regrets about how Countrywide was run,” M said. “We were a world-class company in every respect.”

The firm only made loans that it was confident would be repaid, M said. Countrywide was the third-largest subprime lender in 2006, with about $40.6 billion in the mortgages, compared with $44.6 billion in 2005, according to data from Inside Mortgage Finance.

“We never made a loan knowingly -- and it would be stupid to do so -- that we knew the borrower could not pay. Never,” M said. “All our loans had that one standard from 1968 to the end of my reign at C.”

“It had nothing to do with anything that I did at Countrywide or anything I did in my personal life,” M said. Relatives “were being harassed in school. My name was in the paper every day nationally and internationally, accusing me of things that were absolutely untrue. I could not have my family go through it anymore, and that’s why I settled.”

M “remains really proud of his company and this institution he built,” said his attorney, DS. “It would be unfair to say he doesn’t feel a great deal of empathy for the honest, hard-working Americans who suffered in the financial crisis.”

In the 2011 deposition, M also denied that there was a program called “Friends of A” to reward high-profile customers, including elected officials, with below-market rates for home loans. Instead, he said that he gave people including taxi drivers, stewardesses, and gardeners his business card.

“Almost everybody I come in contact with, that was my job, was to originate loans,” M said. “That’s who I was. That’s why I started the company.”

A perfect example of a man in denial, sitting pretty on millions but also desperate for a clear conscience. There are some things that money can't buy and reputation definitely is one of them in this case. No one would be ludicrous enough to assign full responsibility towards Countrywide but you could bet your last dollar that they certainly didn't do much good. And that's an enormous understatement.