August 7th, 2009
01:52 PM ET
14 years ago

Conrad, Dodd cleared in mortgage investigation

WASHINGTON (CNN) - Two prominent U.S. senators were cleared by the Senate Ethics Committee Friday after a year-long investigation into allegations they received special, unusually favorable terms on mortgages from lender Countrywide Financial.

The six-member committee, split evenly between Democrats and Republicans, found "no substantial, credible evidence" that mortgages given to Sen. Kent Conrad of North Dakota and Sen. Chris Dodd of Connecticut, both Democrats,
violated Senate ethics rules.

At the same time, it concluded that the senators "should have exercised more vigilance in (their) dealings with Countrywide in order to avoid the appearance that (they) were receiving preferential treatment."

In June 2008, it was revealed that Countrywide - one of the companies accused of fueling the subprime mortgage crisis - gave favorable mortgage rates to Conrad and Dodd.

The two senators were enrolled in Countrywide's "V.I.P." program, designed to process and fund home loans for certain customers and senior-level Countrywide employees. Some V.I.P. customers referred by former Countrywide CEO Angelo Mozilo were also known as "Friends of Angelo," according to the committee report.

The committee noted, however, that all V.I.P. and "Friends of Angelo" mortgages were required to meet standards similar to the company's other loans. It also found that discounts offered by the two programs were not the best deals available at either Countrywide or in the broader mortgage marketplace.

Dodd said he sought out Countrywide in 2003 to refinance his two homes - one in his home state of Connecticut and the other in the District of Columbia. He claimed that he never met or discussed the loans with Mozilo.

Conrad used Countrywide in 2004 to obtain a loan for a beach house in Delaware and an apartment building in Bismarck, North Dakota. He told the committee he "briefly" spoke with Mozilo about obtaining a mortgage for the beach house.

The committee concluded that neither Conrad nor Dodd sought to be included in the V.I.P. program. But once they became aware that their loans were "being handled through a program with the name 'V.I.P.,' that should have raised red flags," it noted.

Conrad and Dodd, who insisted they had not acted improperly, both said they were gratified by the committee's finding.

"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," Conrad said in a written statement.

Dodd, who is facing a tough re-election bid in 2010, said he hopes that the dismissal of the charges "will go a long way towards restoring the bond of trust and confidence that I've worked long and hard to build with the people of (Connecticut)."

But "now that the facts have been aired and the lessons learned, it's time to move on."

The committee's reports on Conrad (pdf) and Dodd (pdf).

Filed under: Chris Dodd • Kent Conrad
soundoff (75 Responses)
  1. madison

    It would be nice it this would put to rest the rabid rantings of the Republicans on this issue, but sadly it probably won't.

    August 7, 2009 02:28 pm at 2:28 pm |
  2. barnhardt in NC

    Today has been yet another dark day for neocons, bless their hearts.

    August 7, 2009 02:29 pm at 2:29 pm |
  3. Doug

    Let`s see now: They are Dems., Senate Ethics Committee are Dems.
    Sounds fishy to me.

    August 7, 2009 02:30 pm at 2:30 pm |
  4. David

    You scratch my back and I'll scratch yours.....and no one will get in trouble.

    August 7, 2009 02:34 pm at 2:34 pm |
  5. Dan in B-more, hon.

    LOL, I wonder how many "chips" Dodd cashed in on this one.

    August 7, 2009 02:37 pm at 2:37 pm |
  6. Dave

    then release the documents which show both men got preferrential mortgage deals – oh yeah I forgot, these are Dem's and Dem's did the investigation, so no release of anything just "they are cleared of wrong doing".

    August 7, 2009 02:41 pm at 2:41 pm |
  7. Facts don't mean anything

    What a bleepin joke, this was a sweeter deal than Barry got from Rezco, my bad, their Democrats, no story, move on.

    The battle is just starting, I can't tell you how it is going to end, but I can tell you how it is going to begin................................

    August 7, 2009 02:41 pm at 2:41 pm |
  8. tpbco

    Gee...2 dems cleared by a dem dominated committee.

    Guess there wasn't any "Blue Dogs" on the committee.

    Any one surprised?

    August 7, 2009 02:43 pm at 2:43 pm |
  9. Emmanuel Goldstein

    Gee, there's a surprise.

    August 7, 2009 02:47 pm at 2:47 pm |
  10. d1120

    Gee....Senators clearing Senators....what a concept.

    August 7, 2009 02:48 pm at 2:48 pm |
  11. Jack Kinch(1uncle)

    That is not what Countrywide said..

    The investigation was headed by Barney Frank

    August 7, 2009 02:49 pm at 2:49 pm |
  12. Larry

    Pardoned by their friends. I guess as long as one can get away with it, they all can

    August 7, 2009 02:49 pm at 2:49 pm |
  13. johnq

    Cleared by other dems no doubt.

    August 7, 2009 02:50 pm at 2:50 pm |
  14. midwest liberal

    any minute now republican posters will begin screaming conspiracy...

    August 7, 2009 02:50 pm at 2:50 pm |
  15. Nija

    PONS The new name of the Republican Party. THE PARTY OF NO SOLUTIONS.

    August 7, 2009 02:52 pm at 2:52 pm |
  16. Joe m

    is anyone surprised? we can't possibly have any high ranking members of the ruling party be charged with deeds that their party view as only acts republicans can possibly be guilty of. these ethics investigations should be conducted by independent bodies. they carry little to no credibility, no matter who is being investigated. this is like having any of the finacial institutions that had a hand in the financial collapes conduct the investigation on its cause, or ACORN investigate itself. Ethics is just a word in Washington.

    August 7, 2009 03:03 pm at 3:03 pm |
  17. Steve (the real one)

    So the Senate investigating the Senate! Absolutely no bias there! I am almost certain the dude from Countrywide confirmed a sweetheart deal for these two!

    August 7, 2009 03:13 pm at 3:13 pm |
  18. jj12345

    Of course they were....

    August 7, 2009 03:18 pm at 3:18 pm |
  19. Jeff

    Weren't the Republicans saying these senators were guilty of ethics violations?

    Weren't the Republicans also claiming that Sen Dodd caused the mortgage crisis and subsequent economic meltdown?

    Time to eat some crow, Republicans.

    Bon apetit

    August 7, 2009 03:20 pm at 3:20 pm |
  20. Juan

    Was there ever really any doubt that these fine upstanding fellers were innocent. Not these two freddy and fanny lapdogs.

    August 7, 2009 03:22 pm at 3:22 pm |
  21. Predicta

    Good old boy network at it again...It was pretty apparent from the evidence that Dodd got special treatment for his mortgage. His application even has a special stamp which indicated he had VIP status as a special friend to the head of Frannie Mae. I guess there's no such thing as politics when there's an ethics investigation. These elected officials make me sick.

    August 7, 2009 03:27 pm at 3:27 pm |
  22. I give up

    The fox is guarding the hen house. And the Libs complained about the culture of corruption under Republican rule?!? What a joke and you guys excuse it. Pathetic.

    August 7, 2009 03:29 pm at 3:29 pm |
  23. Mike, Syracuse, NY

    Let's see, the Democratically controlled ethics committee clears two Democratic senators. Yup, more 'change'.

    August 7, 2009 03:46 pm at 3:46 pm |
  24. Katherine

    The more things change the more they stay the same!

    I wonder if the American people will ever say enough is enough?

    August 7, 2009 03:47 pm at 3:47 pm |
  25. AXH


    August 7, 2009 03:48 pm at 3:48 pm |
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