Sunday, June 22, 2008

Senate Banking Committee chairman Chris Dodd is in Bank of America's back pocket gives details on Senator Christopher Dodd's sweetheart mortgage from Countrywide Financial, as well as Bank of America's political contributions. Bank of America is buying Countrywide.
Countrywide's VIP loan to Dodd, which saves the Banking Committee chairman $75,000 over 30 years, smells like a potential quid-pro-quo now that Dodd has pushed a bill that will save the company from itself, but what about Bank of America's behavior?

Bank of America's political action committee (PAC) has donated $20,000 to Dodd since he became chairman of the banking panel 17 months ago. From January 2007 to March 2008, Bank of America employees have donated at least $50,400 to Dodd's campaigns, according to the Center for Responsive Politics. So, while Dodd's sweetheart loan from Countrywide saves him personally $200 per month, his chairmanship earns him politically more than $1,000 per week.

These aren't bank tellers funding Dodd, either, as contributors include Bank of America's director of government affairs John Collingwood and Barbara Desoer, who oversees the merger with Countrywide and will "run the combined companies' mortgage operations," according to The Los Angeles Times....

Bank of America stands to profit most from a bailout. It will take on Countrywide's bad loans, and under Dodd-Shelby, it could shift the worst ones onto the shoulders of taxpayers, via the Federal Housing Authority. Basically, Uncle Sam will buy Countrywide's stinky loans off of Bank of America.

Bank of America is kind of like an investor trying to "flip" a house: they buy a run-down property (Countrywide) for a discount, shell out some campaign contributions and earn some "sweat-equity" through lobbying. If Dodd gets his way, it will be a good investment for Bank of America.

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