House to Subpoena Documents on VIP Mortgages for Members of Congress

Caving to months of pressure from congressional Republicans, the chairman of the House oversight committee agreed Friday to subpoena documents from Countrywide Financial Corporation about its VIP loan program that offered special mortgages to members of Congress and other influential figures.

Sens. Chris Dodd, D-Conn., and Kent Conrad, D-N.D., both received loans from the so-called "Friends of Angelo" program, a reference to the company's former CEO Angelo Mozilo, now charged with insider trading and securities fraud by the SEC.

Rep. Darrell Issa of California, the committee's ranking Republican member, spearheaded the call for subpoenas from Bank of America, which bought Countrywide last year. He said a congressional investigation was needed into what he called "an attempt to bribe" members of Congress.

"Countrywide orchestrated a deliberate and calculated effort to buy powerful friends for the purpose of using these relationships to manipulate public policy and further their bottom line to the detriment to the American taxpayers," said Issa in a statement Friday.

The subpoenas ordered by the chairman, Rep. Edolphus Towns, D-N.Y., capped a tense week in the House Oversight and Government Reform Committee, during which Towns cancelled a committee meeting where Republican members were planning to call for a vote on the subpoenas and later locked Republicans out of the committee chambers.

Towns has acknowledged that he received a home loan from Countrywide, but said he did not get favorable terms from the lender. Countrywide waived normal company rules for VIP's, eliminating lender fees and granting the lowest possible interest rates in some cases.

"We need to clarify unanswered questions about Countrywide Financial's VIP program," Towns said.

Countrywide's codes bar it from trying to influence lawmakers by making special gifts or loans to them. The subpoena will cover documents and e-mails concerning the special loans to members of Congress and other federal and state employees.

"The documents and records we have subpoenaed will expose the inner-workings of Countrywide and how this program came to be and was executed," said Issa.

"We will uncover the true motive and intent behind Countrywide's actions and learn the full size and scope of how this program influenced policymakers and their policy decisions."