It might take more than a public relations company to burnish Countrywide Financial Corp.’s tarnished image, the Los Angeles Daily News reports.
The third quarter ended with company Chairman and CEO Angelo Mozilo catching flak for cashing in $138million in stock options during the past year as the housing market sank. In early summer, the company said Mozilo followed company guidelines, and it reiterated that stance last week.
That might not be the end of the issue, though. That’s because the fourth quarter began with a judge in Wilmington, Del., ruling that the Calabasas-based lender must turn over confidential details on how it grants stock options.
It happened during a hearing in a lawsuit filed against the company by the Louisiana Municipal Police Employees’ Retirement System, a Countrywide investor. It wants the information because it thinks there is something suspicious about stock grants to company executives.
In a statement, Countrywide said the “complaint presented no credible evidence of wrongdoing relating to the purported manipulation of option grants,” according to the Associated Press.
And Friday, the company announced that in accordance with the terms of a pre-arranged stock-trading plan, Mozilo would start selling more shares Monday and continue through Oct. 12.
“The … plan was put in place as part of my financial planning and in recognition of advice I received to diversify my stock holdings,” Mozilo said in a statement, which also noted the trading plan is designed to remove him from active participation in the trading of the Countrywide shares that he owns.
