Issa's first subpoena targets Countrywide VIP mortgage program
Thursday, February 17, 2011; 12:58 PM
The chairman of the House Committee on Oversight and Government Reform sent a wide-ranging subpoena Wednesday to Bank of America for documents, e-mails and names related to Countrywide Financial's VIP and Friends of Angelo Program.
Issa's probe of the now-defunct lender's controversial home loan program is an attempt to expose all lawmakers or other government officials who might have received sweetheart deals from the firm. The subpoena to Bank of America, which now owns Countrywide, marks a significant expansion of an investigation into Countrywide launched in the preceding Democrat-controlled Congress.
"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," Issa (R-Calif.) said in a statement.
"This subpoena will allow us to obtain the information needed to answer the outstanding public interest questions regarding the full size and scope of the VIP program."
Dan Frahm, senior vice president at Bank of America, said the company would comply with Issa's request.
"Upon acquiring Countrywide in July 2008, Bank of America immediately discontinued Countrywide's 'VIP Loan Program,' " Frahm said in a statement. "Bank of America has never had such a program. While we place the highest priority on keeping customer data confidential, we are obliged by Congress to respond to this subpoena."
Countrywide's VIP program came under scrutiny following reports that then-Sen. Christopher J. Dodd (D-Conn.) and Sen. Kent Conrad (D-N.D.) received mortgages from the company. The Senate Ethics Committee found that neither senator violated any rules.
Issa's investigation shows none of the limits of Congress's earlier probes. His subpoena specifically targets documents and records related to borrowers who include current and former members of the House and Senate as well as current and former employees of federal, state or local governments. Bank of America has until noon March 7 to respond.
In subpoenaing e-mail correspondence related to the VIP program - and asking for the number of people in the program between 1996 and 2008 and where they lived - Issa could reveal information about private citizens who might have received sweetheart mortgages.
In a news release, Issa spokesman Kurt Bardella described the VIP program as "Countrywide's efforts to buy friends in critical government and industry positions affecting the company's business interests."
The mortgage program is one of several issues Issa has pledged to probe in his first few months since taking over as chairman. Issa is also investigating Obama administration regulations that businesses say hurt their ability to create jobs; the release of classified diplomatic cables by WikiLeaks; recalls at the Food and Drug Administration; the role of Fannie Mae and Freddie Mac in the foreclosure crisis; what he calls the Financial Crisis Inquiry Commission's failure to identify the origins of the meltdown; and alleged corruption in Afghanistan.