Subprime Litigation
Judge Refuses to Dismiss Countrywide Shareholder Suit
Posted May 15, 2008, 05:58 am CDT
By Debra Cassens Weiss
A California federal judge has refused to dismiss a shareholder lawsuit against directors and officers of Countrywide Financial Corp.
Judge Mariana Pfaelzer ruled Tuesday that confidential witness accounts cited in the complaint were credible and suggested “a widespread company culture that encouraged employees to push mortgages through without regard to underwriting standards,” the New York Times reports.
Pfaelzer wrote that shareholders' "allegations create a cogent and compelling inference that the individual defendants misled the public with regard to the rigor of Countrywide's loan origination process, the quality of its loans and the company's financial situation," the Wall Street Journal reports (sub. req.).
Countrywide also faces a shareholder suit in Delaware that challenges executive compensation and suits by borrowers and by buyers of its mortgage-backed securities.
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Posted by Fred O'Donald - 4 months, 3 weeks, 5 days, 14 hours, 31 minutes ago
Countrywide should be tried under the R.I.C.O. statutes. This criminal organization defrauded millions of consumers by selling them dangerous loans and loans they didn’t qualify for in the first place.
Unfortunately, Countrywide was no alone. Nearly ALL Mortgage lenders did the same. So perhaps indicting the whole bunch might suffice.
BTW: Judge Mariana Pfaelzer is an Idiot.