New York
CNN
—
Angelo Mozilo, former chief executive of Countrywide Financial and a key player in the subprime mortgage meltdown that led to the 2008 financial crisis, died Sunday.
“It is with great sadness that the family of Angelo Robert Mozilo announces his passing from natural causes. The family requests privacy at this time,” The Mozilo Family Foundation, a charitable organization founded by Mozilo and his late wife Phyllis, said in a press release.
Mozilo’s name and that of the mortgage-lending company he cofounded are closely linked to the subprime mortgage meltdown that helped snowball the financial crisis in 2008. He founded Countrywide in 1969, and advertisements for the company boasted that it could get home loans approved for Americans who had previously been turned down.
The company followed through on its promises. But because mortgages were issued to borrowers with inadequate credit, it helped lead to high default rates in 2007 and spur a wave of foreclosures.
The embattled mortgage lender agreed to be acquired by Bank of America for $4 billion in an all-stock deal in 2008. The final cost ended up being even lower. Bank of America reported over $50 billion in losses in the years after the acquisition.
Mozilo was one of several former executives charged by the Securities and Exchange Commission with defrauding investors by hiding the risks of the company’s mortgages.
He agreed to pay $67.5 million to the SEC in 2010 to settle fraud charges, but ended up paying tens of millions of dollars less.