- The Washington Times - Saturday, August 8, 2009

The Senate Ethics Committee on Friday cleared Democratic Sens. Christopher J. Dodd and Kent Conrad of wrongdoing for low-interest mortgages they received in a VIP program, though the panel admonished the pair for a lack of judgment.

The committee, after a yearlong investigation, said it found “no substantial credible evidence” that the home loans secured with Countrywide Financial Corp. violated Senate ethics rules.

Mr. Dodd of Connecticut, who is chairman of the Senate banking committee, and Mr. Conrad of North Dakota vehemently have denied any wrongdoing or ethical lapse in the mortgage deals. Both said they knew they got low mortgage-rate deals in Countrywide’s VIP program but thought the special treatment was a “courtesy” on par with “frequent flier” discounts.

“I’ve said all along that I welcomed a close examination of my mortgages, and I’ve also said all along that [my wife] Jackie and I received the same mortgages that anyone else could have received,” Mr. Dodd said.

But the panel said both should have “exercised more vigilance” in their dealings with now-defunct Countrywide Financial in order to avoid the appearance of receiving preferential treatment based on their status as senators.

Mr. Conrad, chairman of the Senate Budget Committee, said that “while I should have shown more vigilance in the appearance of these transactions, the committee has concluded I did nothing unethical, and that is the truth.”

Government watchdog group Citizens for Responsibility and Ethics in Washington (CREW), which last year brought the complaints against Mr. Dodd and Mr. Conrad to the Ethics Committee, was not pleased with the decision. The group accused the panel of hypocrisy in simultaneously clearing the senators while admitting that Countryside offered them “quicker, more efficient loan processing and some discounts.”

“Like a battered woman who explains she brought the beating on herself, the committee faulted itself for failing to ‘provide more guidance to the Senate community about issues surrounding mortgage negotiations,’ ” added CREW Executive Director Melanie Sloan.

The dismissal of the complaints for both senators was signed by all six members of the committee, which is split along party lines.

The panel’s decision comes at a time when public opinion of Mr. Dodd has waned. The fifth-term senator, who is seeking re-election next year, trailed former Rep. Rob Simmons, a likely Republican challenger, by 9 percentage points in the latest Quinnipiac University poll, released July 23.

Congressional Quarterly and the Cook Political Report peg Mr. Dodd’s Senate seat as a “toss up” in 2010.

Mr. Conrad isn’t up for re-election until 2012.

Within hours of the Senate panel’s decision, Mr. Dodd relayed the news via e-mail to potential donors on his presidential campaign and political action committee mailing list.

“Now that the facts have been aired and the lessons learned, it’s time to move on,” he said. “I’m going to continue fighting for you - humbled, wiser, and always proud to serve the people of Connecticut,” the e-mail stated.

Robert Feinberg, who formerly worked in Countrywide’s mortgage VIP section, said in testimony to congressional investigators in June that the senators were made aware of their status as VIPs, or “Friends of Angelo,” referring to Countrywide’s former Chief Executive Officer Angelo Mozilo.

Mr. Mozilo, whose company lost billions of dollars on bad mortgages before it was bought by Bank of America Corp. in July 2008, has been charged with civil fraud and insider trading by the Securities and Exchange Commission. He has denied any wrongdoing.

Mr. Dodd refinanced two mortgages with Countrywide in 2003 - his home in Connecticut and a residence in Washington. Mr. Conrad acquired mortgages in 2004 for a vacation home in Delaware and an apartment building in Bismarck, N.D.

The two senators may not be out of the investigative woods on Capitol Hill just yet. Rep. Darrell Issa of California, the top Republican on the House Committee on Oversight and Government Reform, on Friday called for his panel to move forward with a subpoena of Countrywide’s VIP program that could further embarrass the pair.

“As I said before the Senate Ethics Committee decision, this committee’s investigation has and will continue to focus on the attempts of Countrywide to buy political influence and not on individual allegations of ethical misconduct by government officials,” he said.

Mr. Issa said that House oversight Chairman Edolphus Towns, New York Democrat, has cited the Senate ethics investigation as a reason for his decision not to move forward with a subpoena of Bank of America.

“The limited scope of the Senate Ethics Committee investigation has not addressed Countrywide’s intentions in extending the benefits of its VIP program to high ranking government officials,” Mr. Issa added. “This was clearly wrong and needs to be fully investigated.”

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