The Financial Crisis After One Year

Angelo Mozilo built Countrywide Financial from the ground up, making it the nation's largest mortgage lender. But its lending included risky loans to questionable borrowers, particularly in places like California, where residents had to stretch beyond their means to secure a piece of the red-hot real estate pie. When housing prices and loan repayments tumbled, so did Countrywide, which was bought by Bank of America in January 2008. In June 2009 Mozilo, along with two other former Countrywide executives, was charged with securities fraud. The suit, a civil complaint brought by the Securities and Exchange Commission, alleges that the men misled investors about how risky the company's loans were. In early September, lawyers for Mozilo filed a motion arguing that there were plenty of public disclosures about the difficulties the firm faced and that the suit should be dropped. The SEC has until Sept. 18 to respond.

Read "Is Mozilo's Crime the Liar Loans — or the Lie?"