One of the more colorful characters in the ongoing subprime drama has given in to pressure and announced that he will forfeit about $37.5 million in severance pay and perks that were to accompany his retirement.
Angelo Mozilo, CEO of Countrywide Financial Corporation was scheduled to receive
over $36 million in cash, a consulting contract with his company worth an estimated
$400,000 a year, and such perks as the use of a corporate plane when he retired.
His company was recently sold to Bank of America as it reportedly teetered on
the edge of bankruptcy, and it is doubtful that Mozilo will have any choice
but to retire.
The CEO has received a lot of the blame for the near demise of what had been the company's largest mortgage company. Mozilo engineered the company's aggressive entry into the subprime market early in the decade.
He has also been under scrutiny by the Securities and Exchange Commission for stock sales he made as the company that he founded was beginning to struggle with subprime losses and he is among several financial industry bigwigs who have been invited to appear before the House Oversight and Government Reform Committee for a hearing on executive compensation.
Despite his decision to forgo the severance money Mozilo will still leave with full pockets. He entitled to a pension plan and an executive retirement plan that was estimated to total $23.8 million in December 2006, the latest information available. He also has over $20 million in deferred compensation and an estimated $5.8 million in company stock.
Countrywide was acquired earlier this month for $4.1 billion in Bank of America Stock. Mozilo was not slated to receive any additional compensation tied to the sale.