Federal Prosecutors Hit Bank of America with $864 Million Fine

The company was found liable for mortgage fraud

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The U.S. government is seeking to have Bank of America Corp. pay nearly $864 million in damages after the company was found liable for mortgage fraud.

U.S. attorney Preet Bharara filed a request Friday that said the fine estimated the total losses the government incurred from the thousands of defective loans it bought from Countrywide Financial during the housing boom. The request also asked that Rebecca Mairone, a former Countrywide executive, be hit with a penalty, the Associated Press reports.

Bank of America, which acquired Countrywide in 2008, and Mairone were found liable of mortgage fraud for selling bad loans to government-controlled companies Fannie Mae and Freddie Mac between 2007 and 2008.

The government said the penalties were necessary “to send a clear and unambiguous message that mortgage fraud for profit will not be tolerated.”

Bank of America spokesperson Lawrence Grayson said on Saturday that the company intends to respond to the request.

“We believe the filing overstates the volume of loans and the appropriate measure of damages arising from one narrow Countrywide program that lasted several months and ended before Bank of America acquired the company,” he said.

Mairone’s lawyer, Marc Mukasey, said he plans to file papers arguing that his client should not be penalized.

[AP]

3 comments
Yoshi
Yoshi

Hah! The truly sad thing is that they will not only continue on, but they will, like JPM be able to write of a large amount of that fine off their taxes. YES, just another "cost of doing business". What a country!

Hotpuppy
Hotpuppy

So .... now that we have established that Bank of America operates with criminal intent....when will they be hit with RICO?  charter revoked, bank siezed?  Other victims compensated?

david.gumbeedog
david.gumbeedog

This should not be a request..it is just a matter of seizing this amount in bank assets.  This is what the federal government does to individuals.  Didn't corporations want the right to be treated like an individual person,  as granted by the supreme court? Seizing bank property, i.e., tangible assets the bank owns outright, seems like a valid, legal, procedure.  Oh wait...what WAS I thinking?  The banks own the Federal Government, thanks to congress and the supreme court.