Bank of America Settles with Government in Mortgage Bond Case

oregonlive.com | November 28, 2014 

By Bloomberg News

A final judgment against Bank of America Corp. in a mortgage-bond lawsuit by the U.S. Securities and Exchange Commission was signed by a federal judge, helping clear the way for the lender to complete a $16.7 billion global settlement of claims it misled investors about risk.

The judgment signed Tuesday by U.S. District Judge Max O. Cogburn Jr. in Charlotte, N.C., bars Bank of America from using deceit or fraud to sell securities. The lender agreed to the terms "without admitting or denying the allegations of the complaint."

The SEC case and a parallel lawsuit by the Justice Department, now settled, were part of a U.S. bid to punish companies for actions the government says helped trigger the financial crisis. Bank of America struck a broad settlement in August with the Justice Department, state attorneys general and other regulators over claims that it sold souring mortgage securities without disclosing all the risks to investors.

The judgment calls for Bank of America to disgorge $109.2 million in profit, $6.62 million in interest and a civil penalty of $109.2 million, according to the filing.

Most of the alleged wrongdoing involved Merrill Lynch & Co. and Countrywide Financial Corp., companies Bank of America bought.

In the North Carolina case, the Justice Department said the lender portrayed its bonds as being backed by prime loans vetted by its staff, even though most were riskier wholesale mortgages originated by outside brokers. Some were "PaperSaver" loans that didn't require proof of borrowers' income, the U.S. said.

Lawrence Grayson, a spokesman for the Charlotte-based bank, declined to comment on the judgment.

In a New York case, Bank of America was found liable by a federal jury last year over claims that Countrywide defrauded Fannie Mae and Freddie Mac by selling them billions of dollars in bad mortgages.

Back to November 2014 Archive

CFLA was founded by the Nation's Leading Foreclosure Defense Attorneys back in 2007 to serve the Foreclosure Defense Industry and fight pervasive Bank Fraud. Since opening our virtual doors, CFLA has rapidly expanded to become the premier online legal destination for small businesses and consumers. But as the company continues to grow, we're careful to hold true to our original vision. For us, putting the law within reach of millions of people is more than just a novel idea—it's the founding principle, just ask Andrew P. Lehman, J.D.. With convenient locations in Houston and Los Angeles, you can contact Our National Account Specialist and General Manager / Member Damion W. Emholtz at 888-758-2352 for a free Mortgage Fraud Analysis or to obtain samples of work product, including cutting edge Bloomberg Securitization Audits, Litigation Support, Quiet Title Packages, and for more information about our Nationally Accredited and U.S. Department of Education Approved "Mortgage Securitization Analyst Training Certification" Classes (3 days) 24 hours for approved CLE & MCLE Credit (Now Available Online).

SEE BELOW- http://www.certifiedforensicloanauditors.com

Call us toll free at 888-758-2352