As reports suggested earlier today, the three ex-Countrywide Financial executives that faced civil fraud charges have settled the beef, avoiding a trial that had been scheduled for next week, according to the Associated Press.
Former Countrywide CEO Angelo Mozilo is now set to pay back $45 million “in ill-gotten profits,” the AP says. He will also pony up $22.5 million in civil penalties. The SEC accused the trio of misleading investors about the quality of Countrywide’s mortgage portfolio, and a civil complaint alleged that Mozilo had traded on insider knowledge when he sold shares of the company before the stock cratered. According to regulators, Mozilo pocketed somewhere in the neighborhood of $140 million as his company teetered toward collapse.
Ex-President David Sambol is paying back $5 million in ill-gotten profits and $520,000 in civil fines, and former CFO Eric P. Sieracki is shelling out $130,000 in civil penalties. They are not admitting wrongdoing.
Countrywide had earlier settled shareholder lawsuit for $600 million. In that case, the plaintiffs alleged the firm had misled investors about the quality of its books. Mozilo, Sambol and Sieracki were likewise named as defendants in that suit.
Update: David Sambol’s attorney was kind enough to send the following statement regarding today’s settlement:
Mr. Sambol has agreed to settle the S.E.C. lawsuit and put the matter behind him for the benefit of his family and loved ones. Notably, in connection with the lawsuit’s resolution, Bank of America will pay the entire disgorgement amount prescribed in the settlement on Mr. Sambol’s behalf. While the agreement with the S.E.C. prevents him from discussing the case, it makes clear that Mr. Sambol does not admit to any of the S.E.C.’s assertions.
Update 2: David Sambol’s attorney would like the record to show that Countrywide, not Bank of America, is paying the entire disgorgement amount.
Mr. Sambol has agreed to settle the S.E.C. lawsuit and put the matter behind him for the benefit of his family and loved ones. Notably, in connection with the lawsuit’s resolution, Countrywide Financial Corporation will pay the entire disgorgement amount prescribed in the settlement on Mr. Sambol’s behalf. While the agreement with the S.E.C. prevents him from discussing the case, it makes clear that Mr. Sambol does not admit to any of the S.E.C.’s assertions.
mtaylor@observer.com
Twitter: @mbrookstaylor
