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U.S. Justice Department seeks over $13 billion from BofA: Bloomberg [April 25, 2014] By Aruna Viswanatha, Karen Freifeld and Peter Rudegeair (Reuters) — The U.S. Department of Justice is asking Bank of America Corp <BAC.N> to pay more than $13 billion to settle allegations the bank overstated the quality of mortgage bonds it sold during the housing bubble, according to Bloomberg News. |
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Sources familiar with that matter told Reuters
on Thursday that discussions were in very early stages, and at
least one source said the $13 billion figure is not currently on
the negotiating table. CNBC News reported that Bank of America's
mortgage securities settlement could exceed $10 billion. Any settlement with the Justice Department would be in addition
to the $9.5 billion accord it reached with the Federal Housing
Finance Agency to resolve similar litigation over residential
mortgage securities, according to Bloomberg News. A possible
agreement to resolve federal and state investigations could come
within the next two months, according to people familiar with
the matter cited by Bloomberg. A Bank of America spokesman declined to comment. A Department of
Justice spokesman was not immediately available for comment. The second-largest U.S. bank faces multiple government probes
over the underwriting, sale and securitization of residential
mortgage bonds before the financial crisis. The bank said in an annual regulatory filing that the staff of
the New York Attorney General's office told Bank of America they
intended to file an action as a result of their inquiry into its
mortgage securities practices. A U.S. Attorney's office advised
Bank of America it would recommend the Justice Department bring
a civil case against its affiliates over mortgage bonds, the
bank said in its filing. (Reporting by Aruna Viswanatha, Karen Freifeld and Peter Rudegeair; editing by Meredith Mazzilli and Lisa Shumaker) [© 2014 Thomson Reuters. All rights reserved.] Copyright 2014 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
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