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McKeon: Nobody told me loan had VIP treatment

Local rep points to yearlong investigation that has yielded no charges as proof he is innocent

Posted: January 18, 2012 9:51 a.m.
Updated: January 18, 2012 9:51 a.m.
 


U.S. Rep. Howard "Buck" McKeon, R-Santa Clarita, says he was unaware he was on a special VIP list when Countrywide Financial Corp. allegedly shaved hundreds of dollars off the cost of his 1998 refinancing loan.

"Nobody told me they were doing me a favor," McKeon told The Signal recently.

On Friday, the Associated Press reported McKeon and Elton Gallegly, R-Simi Valley, each received discounted mortgage loans from the now-defunct Countrywide under a VIP program, quoting an unnamed congressional official.

The congressional official reportedly told AP he was not authorized to speak publicly about the loans and requested anonymity. The loans were first reported by The Wall Street Journal.

The House Oversight and Government Reform Committee has been investigating whether members of Congress received discounts from a Countrywide VIP program with some of the favored customers known as "Friends of Angelo" - a reference to chief executive Angelo Mozilo.

McKeon told The Signal he was unaware his loan was part of the VIP program set up by Mozilo to give discounts to important people.

He said he does not know Angelo Mozilo and has never met him.

"Mr. McKeon is committed to transparency on this," McKeon Communications Director Alissa McCurley said Tuesday. "He believes that the actions of Countrywide should be looked into and wants to get to the bottom of what Countrywide did to his loan 13 years ago."

According to the Associated Press, records show Rep. Edolphus Towns, D-N.Y, former chair of the oversight committee, also received discounts. Towns told the AP previously that he was not aware of receiving any discounts.

On Tuesday, House Republican campaign chairman, Rep. Pete Sessions of Texas, was identified as a fourth congressman who received a discounted mortgage from Countrywide.

Rep. Darrell Issa, R-Calif., chairman of the oversight committee, informed both McKeon and Gallegly that documents received from Bank of America - it bought Countrywide - showed they went through the special unit.

"We do have an ongoing investigation," said Issa spokesman Frederick Hill Tuesday. "We cannot divulge details.

"The names of the lawmakers who have been identified have been referred to the Ethics Committee."

Hill said the focus of the oversight committee remains Countrywide's VIP program.

A spokesman for Bank of America in California, meanwhile, told The Signal Tuesday that the bank never had a VIP program.

"Bank of America never had such a program and, upon acquiring Countrywide, we immediately discontinued their ‘VIP Loan Program.'

"We have and will cooperate fully with any inquiry into this Countrywide program and look forward to putting this matter behind us," said Jumana Bauwens, of the bank's home loans office in Los Angeles.

McKeon told The Signal he recently saw copies of his loan documents that were submitted to the House Ethics Committee by the House Oversight and Government Reform Committee. Attached to the 1998 loan document which the McKeons signed, he said, was what amounts to a Countrywide interoffice memo that says something to the effect of "take a point off the interest and no garbage fees."

McKeon told The Signal the memo was not on the document when he signed it and said he does not know whether the instructions in that memo were ever acted upon. The loan was for $315,000.

Although unconfirmed, the alleged discount amounts to about $4,000.

McKeon, who serves as chairman of the House Armed Services Committee, and his wife, Patricia McKeon, told The Signal they really didn't notice that the loan rate was cheaper than they may have expected.

That loan was on a refinance they did on a foreclosed property they bought in Stevenson Ranch in June 1997 and sold in Aug. 2002.

The couple now lives in Westridge.

McKeon said the House Ethics Committee has been investigating his loan for over a year, and he believes they have found no wrongdoing by him.

"Unfortunately, we do not comment on any specific investigation," said Ethics Committee spokesman Dan Schwager when asked about the congressman's assertion.
McKeon is now under attack by political opponents who have jumped on the "Friends of Angelo" case.

Lee Rogers, a candidate running against McKeon for the 25th Congressional District seat, asked the congressman to release more information about his 1998 discounted mortgage loan.

In a letter drafted by Rogers and sent to the Ethics committee, he notes McKeon received campaign contributions from political action committees for both Countrywide and Bank of America‚Äč, which bought Countrywide in 2008, since taking out the loan.

McKeon told The Signal he has received campaign contributions from Countrywide Home Loans or Bank of America since 1998. The congressman received $3,500 from Countrywide from 1998-2006. Bank of America bought Countrywide in 2008. McKeon received $15,000 in contributions from Bank of America from 1992-2007.

The congressman said it's logical for him to get campaign contributions from banks since he was chairman of the Post-Secondary Education Subcommittee that deals with issues concerning student loans.

"If I had known we had got a good deal (on the loan) then I would have gotten all my loans from Countrywide," McKeon said.

The McKeons have received several home loans for properties over the years.

 

 

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