Countrywide CEO will get $110 million severance for creating subprime mess, and dumping $400 million in stock before CFC fell 80%...

Countrywide CEO will get $110 million severance for creating subprime mess, and dumping $400 million in stock before CFC fell 80% as he was saying 'everything is fine'. Where's the investigation?

Mozilo severance: $110 million and change

If he engineers a sale of battered Countrywide Financial to Bank of America, Countrywide CEO Angelo Mozilo stands to walk away with a severance package worth more than $110 million, the Los Angeles Times' Kathy Kristof reports tonight.

Such a payout would come on top of huge gains Mozilo has made selling Countrywide stock during the mortgage crisis. As the mortgage industry went into a nose dive in late 2006 and 2007, Mozilo cashed out about $140 million in stock options, becoming one of the highest-paid executives in the country, the L.A. Times reported in November.

The newspaper reports tonight that in his contract agreement, which extended the 69-year-old's employment contract through 2009, Mozilo was guaranteed three times his base salary, plus a cash payment equal to three times the greater of his average bonus or the incentive bonus paid the previous year. Net value: $87.8 million.

In addition, Mozilo has two pensions that his severance agreement gives him the right to receive as a lump sum upon his departure. Those pensions were worth $24 million as of December 2006, the last time the company was required to report their value.

There is more. The Times reports Mozilo would receive continuing health benefits for life for himself and his spouse, three years of life and financial planning benefits, and "tax-gross-up payments" to compensate him for any penalties he'd have to pay for receiving payments the IRS might consider excessive.

Given the slashing of 10,900 jobs at Countrywide this year, and the 81% decline in Countrywide stock over the last year, it is likely Mozilo's severage package will prove more controversial than his previous stock sales.