Since he became chairman and chief executive of Columbia National Mortgage Co. in 1993, David J. Gallitano has grown the company from a modest enterprise of 13 branches in seven states to the country's 65th-largest residential loan servicing company, all the while maintaining a low public profile.
"We do try to be very quiet," Gallitano said yesterday in a conference room in the company's corporate headquarters in the Columbia Gateway business park. "We don't like notoriety."
But there was no avoiding the spotlight Monday when President Clinton announced a record $6.5 billion discrimination settlement against Columbia National. The U.S. Department of Housing and Urban Development alleged that the company made too few loans to minorities and low- to moderate-income families.
Gallitano, who canceled a five-day trip to visit branch offices in the Southeast to deal with the controversy, has vigorously defended his company's lending practices and said he is mystified by the motivations of the president and HUD Secretary Andrew M. Cuomo.
"If they were misled, I hope they're sorry, and I would like to get an apology," said Gallitano. "If they did it for political gain, shame on them."
White House officials have said the president stands by his statement, and HUD representatives continued to assert that Columbia National violated the Fair Housing Act, approved by Congress in 1968.
The unwelcome media attention -- Gallitano heard about the president's announcement from a CNN reporter who called seeking comment -- has pushed Gallitano and his company into the public eye.
A Howard County resident since 1993, he lives with his wife -- and cat and dog -- in a 110-year-old farmhouse valued at $455,000 in the historic district of Ellicott City. Last year, he and the company contributed a total of $2,000 to the campaign of Democratic County Executive James N. Robey and $2,500 to that of Charles I. Ecker, the former county executive who ran unsuccessfully for the Republican gubernatorial nomination.
Robey appointed Gallitano to his spending affordability committee two weeks ago.
Piercing eyes and dark hair without a hint of gray belie Gallitano's 51 years. Born and raised in Richfield Park, N.J., he served four years in the Air Force before attending George Washington University, where he graduated in 1973 with a bachelor's degree in economics and business. In 1975, he received a master's degree in business administration from the University of Chicago.
After toiling seven years as a consultant for a Chicago business, Gallitano became the vice president of strategic planning and business development for General Electric Credit Corp. in Stamford, Conn. A year later, he became president and chief executive of General Electric Mortgage Capital Corp. in Raleigh, N.C.
In 1986, Gallitano was hired by New York-based PaineWebber Inc. as executive vice president of the principal transactions group. His responsibilities included monitoring the company's branch in Columbia, which in 1993 became Columbia National, when a group of financial investors bought the office from PaineWebber.
That year, Gallitano left PaineWebber to join Columbia National as chairman and chief executive.
Columbia National isn't the same company that Columbia founder James W. Rouse started in 1939 and that was sold to PaineWebber in 1984. Now boasting 75 offices in 23 states, the company's servicing portfolio increased to $9 billion last year.
Columbia National continues to grow. Gallitano said the company will lease 14,000 square feet next door to its offices this year and expects to open 10 to 15 new offices outside Howard County.
The discrimination allegations haven't stopped the company's plans, but Gallitano said his biggest worry is employee morale.
"My first thought was, 'My God, what are the employees going to think?' " he recalled. "A lot of people here take pride in what they do and believe that they're doing it in a right and ethical way. We have a lot of damage control to do."
To that end, company executives have sent data and press clippings to every employee. When CNN aired a report on the controversy, a television with a video cassette recorder was rolled into the lobby for employees who missed the program.
Gallitano's concern for his employees has inspired supporters to defend the company and its chairman.
"He's a man with a lot of integrity," said Richard Pettingill, senior vice president of Casey Encor International, who sits with Gallitano on the board of directors of the Howard County Economic Development Authority. "He's a very caring person."
Industry analysts said the settlement won't harm Columbia National's ability to lend in the future.
"Companies involved in these developments undergo a lot of internal discussion and training, and as a result, they come out better prepared," said John Bancroft, managing editor of Inside Mortgage Finance Publications Inc.
Pub Date: 1/22/99