Support for LAist comes from
We Explain L.A.
Stay Connected

Share This

This is an archival story that predates current editorial management.

This archival content was written, edited, and published prior to LAist's acquisition by its current owner, Southern California Public Radio ("SCPR"). Content, such as language choice and subject matter, in archival articles therefore may not align with SCPR's current editorial standards. To learn more about those standards and why we make this distinction, please click here.

News

Pennies From Heaven? No, just Corporate Welfare

Stories like these are only possible with your help!
You have the power to keep local news strong for the coming months. Your financial support today keeps our reporters ready to meet the needs of our city. Thank you for investing in your community.

5b2bb4c44488b30009268aa5-original.jpg

New News for those following the ongoing Countrywide trainwreck. As reported by the LA times on Saturday, despite the ongoing national economic worries, and the total meltdown of the company, Countrywide Executives are still set to recieve Big Bucks Big Bucks no Whammies:

The top two executives of beleaguered Countrywide Financial Corp. will pocket $19 million in stock next week, according to a regulatory filing. It's the start of a series of multimillion-dollar payments expected to go to the pair before and after the company's pending takeover by Bank of America Corp.

This comes fairly soon after (as blogged about here at LAist) Countrywide CEO Angelo Mozilo "magnanimously gave up millions in compensation in a cheap attempt to keep the serfs from storming the manor. At the time it looked like swell move, but as one can see, the fiscal setback for poor Angelo was only temporary:

Support for LAist comes from
The payments of stock valued at $10 million for Mozilo and $9 million for Sambol were disclosed in a regulatory filing late Thursday by Bank of America. The payments, described as "performance-based" stock rights and grants, are required by agreements the executives struck with Countrywide less than a year before the sub-prime meltdown forced the distressed Calabasas lender to sell itself, according to the filing.

Interestingly enough, those of us still gainfully employed but reduced to wage earner status have as yet not been afforded such generous compensation for performance. It's probably a safe bet that the vast majority of American workers would be rewarded for the stellar performance the Countrywide team wrought with a fancy pink slip and a denial of unemployment benefits. Fortunately, they're not the only ones annoyed by this vastly unbalanced cost/benefits scheme. Congress is apparently feeling around in its pants and discovering it might have gonads after all:

The largesse for Countrywide Chief Executive Angelo Mozilo and President David Sambol drew immediate fire from Sen. Charles E. Schumer (D-N.Y.), a member of the Senate Finance Committee, whose members have been debating the merits of a government bailout of consumers and mortgage lenders caught in the sub-prime meltdown. "It's perverse for Bank of America to reward the principal architects of the bad business practices that caused this housing crisis," Schumer said in a statement. "Bank of America will hopefully correct the bad practices Countrywide put in place. But enriching people who specialized in deceiving borrowers for the sake of their bottom line will not help that cause."

It's unlikely that any significant change will occur under the current adminstration. Bushies seem more interested in maintaining the robber baron status quo than actually addressing the real damage done by 8 years (and then some) of ill concieved deregulation. Here's hoping sometime in November, Americans rediscover their love of not living in the City of God and vote accordingly. In the meantime, might we suggest a serious renegotiation at your next employee evaluation?

Photo from pingnews.com via Flikr.