Countrywide Probe Puts Rep. Towns in Tight Spot

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Rep. Edolphus Towns (D-N.Y.), chairman of the House oversight committee, has some deep thinking to do. By week’s end, he tells The Hill, he’ll render a verdict on whether his committee will launch a full-scale investigation into failed subprime lender Countrywide Financial. It’s an investigation the committee’s minority staff, under Darrell Issa, has been pursuing for more than a year, with a particular focus on the company’s “Friends of Angelo” VIP loan program. But in order to take his probe to the next level, Issa needs the backing of the full committee to subpoena records from Bank of America, which took over Countrywide following its epic collapse. And Issa has been pressing hard for Towns’ cooperation. Towns, meanwhile, has been dragging his heels on this. Why? One potential reason is because this investigation could shed unflattering light on the favorable financing some congressional lawmakers received through Mozilo’s VIP program.

These alleged sweetheart deals, first reported last summer, have bubbled back up in the news recently. On Monday, the AP reported that a former Countrywide employee has provided some damaging information to Republican oversight investigators and members of the Senate Ethics Committee relating to VIP loans granted to Senators Kent Conrad (D-N.D.) and Chris Dodd (D-Conn.). According to the AP, Robert Feinberg, who worked in the company’s VIP loan section, has said that Conrad and Dodd were made fully aware that they were receiving favorable treatment, a claim both lawmakers strongly deny. This scrutiny comes at a particularly inconvenient time for Dodd, who’s already in serious jeopardy of losing his senate seat in the upcoming election.

This puts Towns in a tight spot. If he goes forward with an investigation, he risks tainting fellow Democrats, as well as other lawmakers who may have received Friends of Angelo financing. If he doesn’t, he leaves himself open to charges that he is playing politics, forsaking his oversight role to provide cover for congressional colleagues. Issa surely isn’t going to let this go quietly.

So what’s it going to be Rep. Towns?

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You expect the big picture, and it's our job at Mother Jones to give it to you. And right now, so many of the troubles we face are the making not of a virus, but of the quest for profit, political or economic (and not just from the man in the White House who could have offered leadership and comfort but instead gave us bleach).

In "News Is Just Like Waste Management," we unpack what the coronavirus crisis has meant for journalism, including Mother Jones’, and how we can rise to the challenge. If you're able to, this is a critical moment to support our nonprofit journalism with a donation: We've scoured our budget and made the cuts we can without impairing our mission, and we hope to raise $400,000 from our community of online readers to help keep our big reporting projects going because this extraordinary pandemic-plus-election year is no time to pull back.

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