Bank of America has been cleaning up after the mess that was Countrywide Financial the mortgage loan corporation that was acquired by BofA in 2008 for $4 billion.

As reported by The Wall Street Journal (Dec. 20), “Four whistleblowers will collect a total of more than $170 million for helping investigators get a record $16.65 billion penalty against Bank of America Corp., among the biggest such payouts to tipsters in history.”

Reuters wrote (Dec. 17), that “Edward O’Donnell had filed a whistleblower lawsuit that accused Countrywide of defrauding government-backed mortgage finance companies Fannie Mae and Freddie Mac by selling them loans that were not as good as the company represented them to be. The case became known as the ‘Hustle’ case due to the Countrywide process through which the loans were sold, which was technically referred to as HSSL.”

“According to the newly released documents, O’Donnell had filed a second case in June accusing a separate Countrywide unit of defrauding Fannie and Freddie through home loans it sold them, for which Bank of America agreed to pay $350 million to settle.”

“The payments,” the Journal reported, “to three individuals and a small New Jersey mortgage company, are in exchange for the whistleblowers’ cooperation in a probe into Bank of America’s mortgage practices in the years leading up to the financial crisis.

“The whistleblower lawsuits accuse the bank or the firm it acquired in 2008, Countrywide Financial Corp., of misdeeds like inflating the value of mortgage properties and selling defective loans to investors.”

And what about Hustler-in-Chief and Countrywide’s Co-Founder Angelo Mozilo?

In 2009, the SEC charged Mozilo with insider trading. In a story originally reported by CNBC (June, 2009), “Mozilo sold hundreds of millions in Countrywide stock in late 2006 and 2007 and is accused of remaining publicly upbeat about his company’s prospects during a period when he knew things weren’t going well for the firm. The SEC put the tally of his profits at $140 million.

“Mozilo’s attorney David Siegel said the stock sales ‘complied with applicable laws and regulations, and were made under the terms of a series of written sales plans which were reviewed and approved by responsible professionals.’

“ ‘All of the SEC’s allegations will be answered completely in court and disproved with the full facts and evidence,’ Siegel said in a statement.”

I guess those “facts and evidence” weren’t quite convincing enough, because in 2010, the former CEO agreed to pay $67.5 million to the SEC to settle fraud charges. CNN reported (Oct. 15, 2010), that “Mozilo will pay $22.5 million in the largest penalty ever on a senior executive of a public company, according to the Securities and Exchange Commission. He will also give up $45 million in ‘ill-gotten gains,’ the SEC said.”

While he avoided going to jail, “Mozilo’s record penalty is the fitting outcome for a corporate executive who deliberately disregarded his duties to investors by concealing what he saw from inside the executive suite,” Robert Khuzami, director of the SEC’s Division of Enforcement, said in a statement.

In the infamous “Friends of Angelo” program, Democratic Senator Christopher Dodd received a $75,000 reduction in mortgage payments from Countrywide. And, according to filmmaker Michael Moore’s documentary, “Capitalism: A Love Story” shows that this was actually over a million dollars. All the while, Dodd, the head of the Senate Budget Committee, called for stronger regulation of mortgage lenders and proposed that predatory lenders should face criminal charges.

The same story points out that then-Speaker of the House Nancy Pelosi’s son, Paul Pelosi, Jr., also received a loan with Countrywide. Barbara Boxer, Adam H. Putnam, Richard C. Holbrooke, James E. Clyburn and Donna Shalala are among those with mortgages from Countrywide,” as did Jamie Gorelic, the Vice Chairman of Fannie Mae.

While I strongly disagree with the SEC’s settlement decision against Mozilo (he should not pass Go, he should Go Directly to Jail, and all politicians should be fined), the three whistleblowers who helped bring about $16.65 billion penalty against Bank of America, will receive a total of $170 million in compensation.

The Journal reported that “The size of the payments is ‘unprecedented in the financial sector,’ said Richard Moberly, a law professor at the University of Nebraska-Lincoln who researches whistleblower cases. The biggest whistleblower awards have typically been associated with drug companies or health-care frauds, he said.”

The other two individuals to receive awards are “Robert Madsen, a former employee of LandSafe Appraisal, a property appraisal company owned by Bank of America, will collect roughly $56 million, according to a person close to the situation. He had filed a complaint against the bank in 2011.”

And “Shareef Abdou, a former Countrywide manager, will receive about $48 million for his cooperation in the investigation, a person familiar with the matter said. Mr. Abdou is on a leave of absence from Bank of America. Mr. Abdou’s complaint alleged that the bank sold defective mortgage loans to mortgage-finance companies Fannie Mae and Freddie Mac.”