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Washington • The chief of staff to then-Sen. Bob Bennett received several preferential home loan deals while the Utah Republican held a key spot on the Senate Banking Committee to fight against reforming the mortgage industry, a new report says.
The GOP-controlled House Oversight and Government Reform Committee says embattled Countrywide Financial waived processing costs and "junk fees" for Mary Jane Collipriest's mortgage and subsequent refinancing loans because she was a "Friend of Angelo," a VIP program named after the lender's former chief executive, Angelo Mozilo.
Collipriest, who now works for Sen. Richard Shelby, R-Ala., was Bennett's communications director at the time of the first loan and later became his chief of staff.
She denied getting any sweetheart deal from Countrywide.
Bennett says he wasn't aware of Collipriest's loan until the House committee first reported a few years ago that one of his staffers got Countrywide financing.
The new report details the strong push Countrywide made to curry favor with members of Congress, their top aides as well as Bush administration officials. The mortgage giant was blamed for helping to trigger the financial crisis that plunged the United States into a recession.
Bennett played a large role in combating legislation to add more regulation of the quasi-governmental mortgage companies Freddie Mac and Fannie Mae. The latter company bought up many of Countrywide's subprime loans.
At one point, Bennett, who lost his re-election bid in 2010, sat down with lobbyists for Countrywide, the congressional report says, and discussed reform efforts, providing information from meetings with other senators.
"Documents and testimony obtained by the committee show the VIP loan program was a tool used by Countrywide to build good will with lawmakers and other individuals positioned to benefit the company," according to the report made available Thursday about Countrywide's efforts to sway Capitol Hill.
"In the years that led up to the 2007 housing market decline, Countrywide VIPs were positioned to affect dozens of pieces of legislation that would have reformed Fannie and Freddie and protected taxpayers."
The report says Collipriest refinanced her mortgage a "number of times" in 2002 and 2003 after being referred to the preferential program by then-Sen. Chris Dodd, D-Conn. One document cited by the committee shows "VIP" written on Collipriest's loan and also the acronym FOA, which stands for "Friend of Angelo."
Bennett, then a senior member of the Senate Banking Committee, fought efforts to strengthen regulation of Fannie Mae and its cousin Freddie Mac. In 2004, he attempted to water down a bill meant to crack down on those mortgage companies.
President George W. Bush's then-Treasury secretary, John Snow, said Bennett's amendment weakened "one of the core powers" needed for the regulation of the loan groups.
The Republican-controlled House oversight committee has probed the Countrywide scandal that ensnared Dodd as well as Sen. Kent Conrad, D-N.D. Dodd has since retired from office; Conrad is not running for re-election.
No one has been prosecuted for Countrywide's dealings with government officials, though the report hints that the company's lobbyists may have skirted federal bribery laws.
"Countrywide's VIP unit processed loans for key senators and Senate staff who could be helpful when legislation that affected the company was drafted or up for a vote," the report states.
Collipriest disputes the comments about her and says she reached out to a person at Countrywide only at the suggestion of her friend, Jackie Clegg Dodd, the Connecticut senator's wife, who is from Utah.
"When I was a bit intimidated by the whole process of buying my first home about 10½ years ago, my friend Jackie gave me the name of a person I could call so that I could speak with a warm body rather than trying to navigate through automated phone prompts or a website," Collipriest wrote Thursday in an email. "I got a market-rate loan and certainly didn't receive a 'sweetheart' deal or any kind of preferential treatment."
Bennett, who now runs a consulting business, also dismissed the report on Collipriest.
"This is old news," Bennett said. "I checked into the matter at the time this all became public, and I am, and was, satisfied that neither she, nor Countrywide did anything wrong."
Bennett had previously said he would cooperate if the Senate Ethics Committee wanted to investigate. That panel had scrutinized the loans by Countrywide for Dodd and Conrad but said they weren't below market rates and cleared the two of any wrongdoing.
The committee did not issue any public response to questions about Senate staff receiving deals from the mortgage company.
Online: See report
O Read the congressional report online. > tinyurl.com/czoomec