California Attorney General Jerry Brown filed a complaint today in Los Angeles state court claiming that Countrywide Chief Executive Officer Angelo Mozilo and a unit specializing in loans to consumers with poor credit used deceptive marketing tactics to entice thousands of borrowers into ARM loans without disclosing that their payments would balloon after 30 days. Jerry Brown is one of the first two AGs to file suit against lenders like Countrywide that glutted the mortgage market with misleading subprime loans.
According to Bloomberg News, Mr. Brown seeks restitution for borrowers, civil penalties of as much as $2,500 per violation and a court order halting the practices.
