Countrywide Financial Corp. is being probed by the U.S. Federal Bureau of Investigation for possible securities fraud

The FBI said on Jan. 29 that it was investigating 14 companies for possible accounting fraud and other crimes related to the subprime lending crisis. It didn't identify any of the 14 by name. Countrywide Financial Corp. is being probed by the U.S. Federal Bureau of Investigation for possible securities fraud, the Wall Street Journal reported, citing unidentified law enforcement officials and finance industry executives.
The probe, which is at an early stage, is focusing on whether Countrywide officials made misrepresentations about the company's financial position and the quality of its mortgage loans in securities filings, the newspaper reported, citing four unidentified people with knowledge of the matter. Countrywide spokeswoman Jumana Bauwens said the company was unaware of an FBI probe. Bank of America Corp., which is in the process of buying Countrywide, declined to comment, spokesman Scott Silvestri said. Fifteen other subprime companies are under scrutiny by federal agents and prosecutors in relation to possible mortgage- origination fraud, conflicts of interest and practices used to package mortgage-backed securities for sale to investors, the newspaper said. The investigation is being handled in New York and overseen in Washington, the Journal said. Washington-based FBI spokesman Richard Kolko declined to identify any of the 16 financial institutions the Bureau is investigating along with the Securities and Exchange Commission. Countrywide yesterday declined 13 cents, or 2.5 percent, to $5.07 a share, 20 percent lower than its closing price on Jan. 11 when Bank of America, the nation's second-biggest bank by assets, offered to buy the company for about $4 billion in stock. The stock has declined 86 percent in the past year in New York Stock Exchange trading. Countrywide Chief Executive Officer Angelo Mozilo testified yesterday before the House Oversight and Government Reform committee, which questioned why CEOs received hundreds of millions of dollars in compensation while shareholders took the brunt of millions in writedowns from subprime mortgages. ``Countrywide is the focus of politicians and others who often are looking for people they can paint as villains,'' said Gary Townsend of Chevy Chase, Maryland-based Hill-Townsend Capital, which invests in financial industry stocks. ``Congress could be the motivator if the FBI is taking this action