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BREAKING NEWS: CNBC's David Faber: THE SEC WILL CHARGE ANGELO MOZILO, FORMER CHAIRMAN AND CEO OF COUNTRYWIDE FINANCIAL, WITH INSIDER TRADING, IMMINENTLY

BREAKING NEWS: CNBC's David Faber: THE SEC WILL CHARGE ANGELO MOZILO, FORMER CHAIRMAN AND CEO OF COUNTRYWIDE FINANCIAL, WITH INSIDER TRADING, IMMINENTLY

THE SEC WILL CHARGE ANGELO MOZILO, THE FORMER CHAIRMAN AND CEO OF COUNTRYWIDE FINANCIAL, WITH INSIDER TRADING, IMMINENTLY, ACCORDING TO PEOPLE FAMILIAR WITH THE SITUATION.

THE SEC WILL ALSO CHARGE COUNTRYWIDE'S FORMER COO DAVID SAMBOL AND ITS FORMER CFO ERIC SIERACKI WITH SECURITIES FRAUD FOR FAILING TO DISCLOSE THE FIRM'S RELAXED LENDING STANDARDS IN ITS 2006 ANNUAL REPORT.

THE CHARGES, EXPECTED TO BE UNVEILED BY THE SEC LATER TODAY, WILL NOT BE ACCOMPANIED BY ANY CRIMINAL INDICTMENTS.

MOZILO SOLD HUNDREDS OF MILLIONS IN COUNTRYWIDE'S STOCK IN LATE 2006 AND 2007, AND STANDS ACCUSED BY THE SEC OF REMAINING PUBLICLY UPBEAT ABOUT HIS COMPANY'S PROSPECTS DURING THAT PERIOD, WHILE HE KNEW THINGS WERE NOT GOOD IN COUNTRYWIDE'S BUSINESS.

HOW THE SEC INTENDS TO PROVE THAT IS UNCLEAR, BUT MOZILO'S CHANGE TO A 10-B 5-1 PLAN UNDER WHICH HE SYSTEMATICALLY SOLD STOCK MAY BE USED AS EVIDENCE OF HIS CULPABILITY.

MOZILO ALLEGEDLY ESTABLISHED ONE 10-B5-1 PLAN IN OCTOBER OF 06 AND ANOTHER IN DECEMBER OF 06 AND THEN REVISED THE OCTOBER PLAN IN FEBRUARY OF 07 SO THAT HE COULD INCREASE HIS SALE OF COUNTRYWIDE STOCK.

A CIVIL CASE SUCH AS THIS FACES A FAR SMALLER BURDEN OF PROOF THAN DOES A CRIMINAL CASE AND IT IS NOTABLE THAT THE SEC'S ACTION IS NOT ACCOMPANIED BY ACTION FROM LAW ENFORCEMENT AUTHORITIES.

THE SEC HAS BEEN UNDER A GOOD DEAL OF PRESSURE TO SHOW SOME REGULATORY MUSCLE IN THE WAKE OF THE MADOFF FRAUD AND ITS GENERAL FAILURE TO ADEQUATELY POLICE THE INVESTMENT BANKS THAT WERE ONCE UNDER ITS SUPERVISION.

THE SEC'S ACTION HAS BEEN EXPECTED. MOZILO AND HIS LIEUTENANTS RECEIVED WELLS NOTICES ADVISING THEM OF LIKELY SEC ACTION AGAINST THEM LAST MONTH.

COUNTRYWIDE BECAME THE NATION'S LARGEST SINGLE HOME LENDER DURING THE HOUSING BOOM AND WAS ACQUIRED BY BANK OF AMERICA AFTER MUCH OF ITS BUSINESS, WHICH INCLUDED A HUGE PRESENCE IN SUBPRIME MORTGAGES, DETERIORATED.

MR. MOZILO'S LAWYER SAID HE WOULD NOT COMMENT ON RUMORS CONCERNING ANY LITIGATION OR INVESTIGATION.




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