CFC insider trading scandal looming?

Discussion in 'Stocks' started by blast19, Mar 13, 2007.

  1. blast19


    I've sent the letter pasted below to the WSJ, Herb Greenberg, and the NY Times...hopefully it will gain some sort of traction...thought some of you guys might like to look at it:


    To whom it may concern,

    I think it would be a great story to note a few things. With the brewing scandal regarding subprime loans, NEW and LEND have been grabbing a lot of headlines. Another institution which has made a lot of press is Countrywide because they are the largest mortgage lender.

    The CEO, Angelo Mozilo was on CNBC's Closing Bell program today discussing the issue and stating his case. While he didn't paint a pretty picture for the future, he did note, in his own words, "that at the end of the day, this will be good for Countrywide."

    It is curious to note that Mr. Mozilo has sold 386,000 shares of Countrywide holdings in the last two weeks alone! If you want to go back further you can see that he has sold many many more than just 386,000 shares:

    As you can see at the link below, Mr. Mozilo has depleted his holdings to a paltry sum compared to what he once held:

    It is extremely interesting to note that Mr. Mozilo sold these shares under the umbrella of a 10b5-1 which is prearranged. The curiosity is why this man arranged the plan in the first place. It is commonly shunned when a CEO or major insider unloads so many shares in this manner.

    The real questions arise when you factor in that the company is buying back up to 1/8th of their outstanding shares. The CEO unloading stock mixed with a company buyback in a declining market is not in the best interest of shareholders and Mr. Mozilo would seemingly have some explaining to do as to how anything he has done recently, from the buyback to selling almost all of his holdings to his appearance on CNBC, equate to shareholder interests.

    It just seems to me that there are more than a few lingering questions regarding the actions of this man and the company. It's a disturbing trend to see such large businesses go bust and Mr. Mozilo's sale of stock lends(sic) to the idea that he is heading for the hills and kosher doesn't exactly come to mind as a verb when you factor in some of the above.

    Information regarding the stock buyback:

    I thank you for your time in reading this email and I hope that it makes for interesting reading material for you. I feel that investors would be aghast to see such a large corporation chugging on in this looming scandal in such a dysfunctional manner.

    You are one of the better luminaries to break scandalous Wall St. activity and this one is of epic proportions...please don't ignore it.

  2. Mvic


    PS I am short as hell :D

    Can't hurt, nice one blast.
  3. I just looked at CNBC .com, and the CEO says everything is ok with them. Do you think he's lying? He wouldn't lie, would he?
  4. blast19


    Nah, that dog only sold $150 million worth of stock in the last few months!

    His interest in the future of the company is nearing nil...only has 350k more shares to unload...soon enough he'll probably abandon ship.

    Look, an onslaught of class action suits can't be far off...I'm going to contact a few lawyers and send them my letter...they'll love this one.
  5. excellent!

    I was wondering if there was much downside potential with CFC too.

    Hopefully I can find some shares to short tomorrow as well!

    good night guys.

    Amazing how stocks fall so much faster than they seem to rise isn;'t it?
  6. blast19


    Buy the puts my friend...easier leverage.

    I am actually contacting class action attorneys...sometimes you have to go to the dogs to get the job done and I would really like to see Angelo grilled for this disgusting job he's pulling with the sales.

    good luck.
  7. blast19


  8. It's interesting but the writing has been on the wall for the housing market for a few years now. I'm not at all surprised that a multi-decade veteran cashes his chips out right now. Especially since he can reload with options every year.

    Best of luck with trying to stoke the fire. I think there will be plenty of pain for CFC down the road as well. I can tell you they are a big player in the Ventura county employment market so a take down there will blow the local housing market -- which is heavily overvalued -- as well.
  9. blast19


    That's funny...I'm originally from Ventura County.

    Mozilo's extreme selling is a panic sign to me. Nothing announced, he'll be in the job until 2009, etc. I find that to be a really big red flag. Especially when he goes on tv practically begging for interest rate cuts.

    Just my perception...I think there's fire behind his smoking corpse. :D
  10. fatrat


    I was short this stock at $35. Day before yesterday was great, then yesterday some dickwad analyst gave this stock an upgrade. I didn't understand the reason for the upgrade, and now today, I find this stock up and against me with an accidental move past my initial stop.

    Why is this stock up as much as it is? I read that some mutual funds have heavy ownership in this stock. Why would they accumulate more of this garbage?
    #10     Mar 15, 2007