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Ethics Panel to Probe Dodd, Conrad Mortgages

The Senate Ethics Committee is beginning an initial investigation into whether Sens. Kent Conrad (D-N.D.) and Christopher Dodd (D-Conn.) got preferential mortgage rates from Countrywide Financial Corp., even as the two senators are taking decidedly different approaches to dealing with the revelations.

Senate Ethics Chairwoman Barbara Boxer (D-Calif.) confirmed today to The Washington Post's Paul Kane that her panel had received an official complaint against Dodd and Conrad, a step which under Senate rules automatically triggers a preliminary inquiry into the matter. The watchdog group Citizens for Responsibility and Ethics in Washington wrote to both the House and Senate ethics panels last week asking for investigations.

For his part, Conrad has already announced that he would donate money to charity to make up for his alleged mortgage benefit, and that he would refinance the mortgage on an apartment building he owns, one of his two mortgages in question. He has also paid off the remainder of his loan on a Delaware beach house and has said he welcomes an Ethics inquiry.

Dodd, the chairman of the Senate Banking, Housing and Urban Affairs Committee, attempted to address the issue himself today in a press conference that, to use the journalistic cliche, "raised more questions than it answered."

"As a member of the United States Senate, the idea of asking or seeking any kind of financial preference ... is something I completely reject, and any offer that would ever be made I would terminate immediately any suggestion of it," Dodd said. After recounting the comparative shopping process he went through to obtain his two mortgages, on houses in Washington and in Connecticut, Dodd said: "At no point did anyone ever suggest to me that we were supposed to get some 'deal' out of Countrywide. I never spoke to anybody except loan officers about this, never any higher-ups or any senior people at Countrywide."

After reiterating that point, Dodd casually mentioned to surprised reporters that he and his wife had actually known back in 2003 that they had been put in some sort of "VIP" program.

"In fact we knew at the time, I think, going into it, we got a call and were told apparently that we were being dealt with by that group within Countrywide," Dodd said, explaining that he was told "there was a VIP section we were in" but he did not assume he would get any special treatment as a result.

"We thought it was a courtesy," Dodd said, later adding that he had figured his VIP status was based on the fact that he and his wife had two mortgages in good standing with the company. He did not ask what the VIP status meant, nor did he ask if it had anything to do with him being a Senator.

As for whether he would emulate the way Conrad has dealt with the issue, Dodd said, "I don't know that we did anything wrong. I negotiated a mortgage at a prevailing rate, a competitive rate. ... I don't feel at this point I have any obligation. I did what I was supposed to do." Dodd said he wouldn't terminate his loans with Countrywide because he doesn't want to "blame the whole institution" for what happened, and that he wouldn't refinance because rates are higher now.

Deliberately or not, Dodd also took a shot at Conrad during the press conference. Conrad has admitted that he spoke directly to Countrywide CEO Angelo Mozilo when he was shopping for a mortgage, though he has denied he knew he was getting any special treatment. Asked about his own relationship with Mozilo, Dodd said: "I don't know the man. ... I've never talked to him about my mortgages and I never would. The idea that you'd call the CEO of a bank to get a mortgage, I just wouldn't do it."

In an interesting bit of timing, Dodd and Sen. Richard Shelby (Ala.), the top Banking Committee Republican, announced before Dodd's press conference today that they had reached a bipartisan deal on a housing bill. Dodd dismissed any suggestion that his mortgage controversy would affect his ability to shepherd the measure through the Senate. "This is the first time I've ever heard anyone suggest this [bill] was a favor to Countrywide," he said.

By Ben Pershing  |  June 17, 2008; 5:26 PM ET
Categories:  Ethics and Rules  
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