Top Talent Scout for Obama Tied to Subprime Lender

More on this important story. Both Obama and McCain are saddled with shady subprime connections -- and McCain even tops it off with S&L scandal connections.

James Johnson, one of three people tapped by Mr. Obama recently to oversee the search for his running mate, took at least five real estate loans totaling more than $7 million from Countrywide Financial Corp. through an informal program for friends of the company's CEO, Angelo Mozilo, the Wall Street Journal reported Saturday. The Journal said at least two of the mortgages, among a series of loans made available to people Countrywide officials called "friends of Angelo," were at rates below market averages, though it is difficult to predict a market rate without access to nonpublic information about a borrower's credit history and other factors that can reduce interest charges on a loan.

Among the loans to Mr. Johnson, according to the Journal, were a $5 million home equity line of credit against a house in Ketchum, Idaho, a 5.25% loan of $1.3 million for a home in Palm Desert, Calif., and a 3.875% loan of $971,650 for a home in Washington, D.C. The interest rates applied for the first five years of the loans.

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Since leaving Fannie Mae, Mr. Johnson has lavished praise on Mr. Mozilo's performance, calling it "remarkably impressive " in a 2003 interview with BusinessWeek. "By strengthening servicing in good times, Countrywide has done a brilliant job of insulating itself for the down cycle," Mr. Johnson told Fortune in 2003.