The Securities and Exchange Commission accused Mozilo as well as former Countrywide President David Sambol and former Chief Financial Officer Eric Sieracki of hiding from the public growing problems in Countrywide's portfolio of risky loans.
Those problems eventually led to the sale of Calabasas-based Countrywide, once the nation's top originator of home loans, to Bank of America Corp. in 2008.
The SEC also accused Mozilo of insider trading regarding his sale of nearly $140 million of Countrywide stock.
All three men have consistently denied wrongdoing at Countrywide.
Sambol and Sieracki also reached settlements with the SEC. Sambol agreed to pay approximately $5.5 million in penalties while Sieracki agreed to pay $130,000. The settlements were disclosed at a court hearing Friday Oct. 15 before Judge John Walter, who was presiding over the case.
As part of the agreement, Mozilo was banned from ever serving as an officer or a director of a public company. Sambol agreed to a three-year ban.
The deal allowed the three men to avoid going to trial this month. The three former executives still face a federal criminal probe into Countrywide by the U.S. Attorney's office.