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Senate ethics panel takes new look at Countrywide loans


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The Hill:

Senate ethics panel takes new look at Countrywide loans
By Susan Crabtree - 08/12/10 06:00 AM ET

The Senate Ethics Committee is re-examining the participation of senators and staffers in a controversial VIP mortgage-lending program at Countrywide Financial Corp, according to a source familiar with the panel’s activities.

The Ethics Committee in recent days has begun to look into new information about Senate involvement in the Countrywide loan program, the source said.

In mid-July Sen. Bob Bennett (R-Utah) agreed to assist the ethics panel after learning that senators or Senate staff received at least 30 Countrywide loans that offered sweetheart deals of special treatment.

Rep. Darrell Issa (R-Calif.), the ranking members of the House Oversight and Government Reform Committee, sent a letter to Senate Ethics Committee Chairman Barbara Boxer (D-Calif.) last month, calling for an expanded inquiry into the VIP loan program and noting that borrowers on a dozen loans listed their place of employment as the office of “Senator Robert Bennett.”

An Issa spokesman declined to comment when asked whether the ethics committee had contacted the Oversight panel.

Issa received the information from Bank of America, which now owns former Countrywide, after a hard-fought battle to convince Chairman Edolphus Towns (D-N.Y.) to issue subpoenas in the matter.

Bennett, who lost his June primary, did not have a Countrywide loan and at the time said he did not know whether his staffers did or whether those aides are still working for him.

If the Senate Ethics committee decides to investigate, Bennett said he would cooperate.

“I've never had a Countrywide mortgage and I do not inquire into the personal financial dealings of my staff,” he said in a July statement. “I have no idea which of them have mortgages and with whom. The loans were apparently issued several years ago, and we have no names, so I do not know if these staffers are still employed by my office.

“Should the Senate Ethics Committee decide the matter warrants an inquiry, I will certainly assist them in any way, and require that my staffers do the same,” he continued.

The Senate Ethics committee has already investigated allegations that Sens. Chris Dodd (D-Conn.) and Kent Conrad (D-N.D.) benefited from the Countrywide VIP program. The panel cleared the senators of any wrongdoing but warned them that they should have exercised better judgment and should have questioned why they were being put in the “Friends of Angelo” VIP program.

If new information is discovered about Dodd’s and Conrad’s loans, any potential ethics committee investigation would encompass the new material and also could ensnare other senators’ offices. Besides the loans listing Bennett’s office as their employer, 18 others identified“U.S. Senators” or “U.S. Senate” as their place of employment,according to Issa’s letter to the ethics committee.

“The pervasiveness of discounted loans and preferential treatment for Senate employees sheds new light on the purpose and policies of Countrywide’s VIP program,” Issa wrote. “Furthermore, a high concentration of VIP borrowers in specific Senate offices is prima facie evidence that Countrywide strategically targeted Members positioned to help the company during a critical period.”

The Senate Ethics committee is prohibited from commenting on existing or potential investigations.
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