Angelo Mozilo, former CEO of Countrywide Financial, has agreed to pay a settlement of $22.5 million resulting from charges that he and two other executives from the firm misled investors during the emergence of the subprime mortgage crisis. As part of the settlement, Mozilo is also permanently banned from serving as an officer or director of any public company.
The announcement was made by the SEC on Friday. In addition to the settlement, Mozilo must also disgorge $45 million of “ill-gotten gains,” a result of insider trading and disclosure violations. The whole of the $67.5 million is to be returned to investors who were hurt by Mozilo’s actions.
David Sambol and Eric Sieracki, also former executives of Countrywide—COO and CFO, respectively—also agreed to settlements. Sambol must disgorge $5 million and pay a penalty of $520,000, and is subject to a three-year bar against serving as an officer or director; Sieracki is on the hook for a penalty of $130,000, and is barred for one year from practicing before the SEC. Those penalties and disgorgement will also be returned to investors.
In settling, the three neither admit nor deny the charges that were filed against them.