Countrywide Ordered to Open Books

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Countrywide Financial Corp. was ordered Wednesday to open its books and records to assist an investigation into possible manipulation of stock option grants to executives.


The order came as part of the Louisiana Municipal Police Employees’ Retirement System lawsuit filed in Delaware Chancery Court last year that accused the Calabasas lender of a “statistical correlation” between some grants and short-term stock price increases.


A judge ruled Wednesday that the company must provide access to its financial records, Bloomberg News reported.


The state of Massachusetts’ pension system also plans to file a class action lawsuit against the lender by Oct. 15 to try to recoup as much as $20 million it says was lost on the company’s stock.


The lawsuits come amid a steep drop in the price of Countrywide’s stock following amid the collapse of the housing market and the subprime lending sector. The stock has lost more than half its value since hitting a 52-week high of $45.26 in April.


Shares of Countrywide were down 21 cents to $20.08 in afternoon trading on the New York Stock Exchange.

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