SEC To Probe Countrywide (CFC) CEO

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Did he or didn’t he? That is the question being asked about Countrywide (CFC) CEO Angelo Mozilo and his 10b5-1 stock sales plan. Normally these programs are set up to cover regular stock sales over a number of months or years.

If the plan is entered into on a date when the executive has no knowledge of material company events, the individual can sell a set number of shares on a set timetable. The plans are rarely altered until the selling is completed. The programs allow shares to be sold during black-out periods and when executives do have material information because the sales dates and number of shares sold were set in advance.

But, Mozilo appears to have changed his plan to accelerate his sales. According to The Wall Street Journal, he "sold at least $130.6 million in company stock in the first half of the year."

If Mozilo did make a change and increase the pace of his sales or knew something about the upcoming mortgage market meltdown when he initially filed for the selling, things may get mighty hot for him.

Douglas A. McIntyre