The Senate ethics committee cleared Sens. Chris Dodd and Kent Conrad of breaking rules by accepting VIP mortgages, even as it scolded them Friday for not being more careful to avoid the appearance of getting sweetheart deals.
The Select Committee on Ethics told Dodd of Connecticut and Conrad of North Dakota in separate letters that it found "no substantial credible evidence" after a yearlong investigation that their Countrywide mortgages broke Senate gift rules.
The two influential Democrats got cut-rate mortgages through a VIP program for friends of then-Countrywide Financial CEO Angelo Mozilo.
Both senators have said that at the time the mortgages were being written they didn't know they were getting special deals.
"I'm pleased and gratified that the Democrats and Republicans on the Ethics Committee have dismissed this complaint and found that the underlying accusations simply were not credible," Dodd said in a statement. But he added that, "I understand that my reaction to those false allegations only served to foster cynicism. And that was my fault."
Dodd planned an afternoon news conference in Hartford to answer questions about the matter.
Conrad said the Ethics panel's finding "confirms what I have said all along: I did not ask for or receive any preferential pricing on my loans. While I should have shown more vigilance in the appearance of these transactions, the committee has concluded I did nothing unethical, and that is the truth."
The panel of three Democrats and three Republicans said it heard testimony and pored through 18,000 pages of documents from Countrywide -- which has since been bought by Bank of America -- to reach its conclusions.
The investigation stemmed from a complaint by the watchdog group Citizens for Responsibility and Ethics in Washington that charged that the two senators' violated Senate rules against knowingly accepting gifts.
The rule has an exception for loans that are provided on terms generally available to the public. The panel also said it looked into whether Dodd and Conrad violated another rule that bars senators from using their official positions for personal gain.
While it found no basis to believe Senate rules had been broken, the panel did take the unusual step of admonishing both Dodd and Conrad for not doing more to prevent the appearance that they were getting special treatment.
Dodd and Conrad "should have exercised more vigilance in your dealings with Countrywide in order to avoid the appearance that you were receiving preferential treatment based on your status as a senator," the committee wrote to them.