By Karey Wutkowski, Reuters, June 23, 2008
23 Jun 2008 // It wasn't only Democratic senators who got loans from Countrywide Financial Corp (nyse: CFC - news - people ), according to financial disclosure documents that show two Republicans on a key U.S. House committee also had loans with the troubled mortgage lender.
There was no immediate indication the two Republicans and a Democratic representative on the House Financial Services Committee enjoyed preferential interest rates from Countrywide of the type that has resulted in a Senate ethics panel investigation of two Democratic senators.
In the Senate, some Republicans have attempted to delay legislation to stem home foreclosures by pointing to Democrats' connections to Countrywide, although the company has given political donations to both Democrats and Republicans.
Congress is debating a multibillion-dollar mortgage rescue plan that would take some failing loans off the books of lenders like Countrywide.
The three members of the House panel that disclosed Countrywide loans are Reps. Adam Putnam and Tom Feeney, both Republicans from Florida, and Rep. Joe Baca, a Democrat from California.
Countrywide, the largest U.S. mortgage lender, is under federal investigation and has been criticized for giving risky loans to people with poor credit histories. Bank of America (nyse: BAC - news - people ) is acquiring Countrywide in a deal expected to close soon.
Sens. Christopher Dodd and Kent Conrad this month acknowledged receiving preferential loan treatment in Countrywide's VIP program. Dodd heads the Senate Banking Committee and Conrad leads the Senate Budget Committee.
Both senators have denied any wrongdoing.
Lawmakers are not required to disclose home mortgages in their annual financial disclosure form, but over a third of the members of the House Financial Services Committee disclosed a mortgage lender in their most recent forms.
The committee drafted a plan approved by the full House to help prevent foreclosures.
In May 8 votes on the House floor, the committee members that disclosed Countrywide loans voted along party lines. Baca voted for the plan, while Feeney and Putnam voted against it.
FINANCIAL DISCLOSURES
Baca sought to erase a reference to his Countrywide loan after revealing it in his 2006 financial disclosure report.
Baca wrote in a June 12, 2006, letter to the House clerk's office: "This is to notice you that I disclosed my own personal home mortgage on my disclosure form, it was not necessary. Please replace this new amended schedule V with the old one." The new table of liabilities excluded the Countrywide loan.
A spokesman for Baca said the lawmaker refinanced a loan with Countrywide in 2006 at market rate. He said Baca amended his disclosure form because staff members realized the mortgage information was not required.
Feeney's spokeswoman said he refinanced a loan on an Orlando rental property in June of 2003 at 5.5 percent with Southern Security Mortgage Co, which later sold the loan to Countrywide.
"Tom and Ellen Feeney have never called a CEO or official of a national lender to request special treatment, and Tom believes it would be inappropriate to do so," Pepper Pennington, Feeney's spokeswoman, said in a statement.
Putnam is not a Countrywide VIP customer, and arranged his 6.125-percent 30-year loan with a fixed rate on a Washington rental property through Countrywide's toll-free number, according to spokesman Keith Rupp.
Putnam is a co-signer of a letter last week by several Republican lawmakers calling for an investigation into whether any lawmakers received special breaks on interest rates.
A review of disclosure documents filed by Dodd's colleagues on the Senate Banking Committee did not show any voluntary disclosures of Countrywide loans this year.
Dodd and Conrad refinanced properties through Countrywide in 2003 and 2004, according to Conde Nast's Portfolio.com Web site which said Countrywide often cut rates and fees for VIPs.
Dodd received a 4.25 percent rate on his Washington home and 4.5 percent on his Connecticut property, Conde Nast said.
Melanie Sloan, executive director of the non-partisan watchdog group Citizens for Responsibility, called for investigators to obtain records from Countrywide to determine which lawmakers were in the VIP program.
"As in any situation, it's always a concern that a member of Congress will be swayed by a special interest rather than the public interest," said Sloan.
POLITICAL DONATIONS
According to the non-partisan Center for Responsive Politics (CRP), Dodd was near the top of a list of lawmakers who received the most money from Countrywide. The senator received $20,000 from the company's political action committee during his career, including $10,000 in Countrywide donations in the 2008 cycle, CRP said.
The CRP said Countrywide spent $1.3 million on federal lobbying last year, and $250,000 in the first quarter of 2008.
Countrywide and its employees have contributed $1.3 million to political parties, candidates and committees since the 1990 election cycle, according to the CRP. Nearly 60 percent of that went to Republicans and 40 percent to Democrats.
Conrad has received $9,000 during his congressional career, Feeney $11,000, and Baca $4,500, it said.
Even Texas Republican Rep. Jeb Hensarling, who has been seeking more information on lawmakers' connections to Countrywide, has taken $9,000 from the lender, CRP said.
A Hensarling spokesman did not return a call seeking comment.