BOA agrees to record $17bn settlement

by Ryan Smith20 Aug 2014
Bank of America has reached a record $17 billion settlement with the government over sales of shoddy mortgage-backed securities during the run-up to the financial meltdown. The settlement is the largest with a single corporation in U.S. history.

Citing officials familiar with the negotiations, the Associated Press reported today that the lender would pay the government $10 billion in cash and provide $7 billion in consumer relief.

The deal also requires the bank to acknowledge misrepresenting the quality of mortgage-backed securities it sold, as well as those sold by its Countrywide and Merrill Lynch units, according to the AP. Those units, responsible for most of the shoddy loans, were acquired by Bank of America in 2008.


  • by Sbharkness | 8/20/2014 3:21:33 PM

    I suppose Alex Sanchez would say that this is also the result of Mortgage Brokers being a shadow industry that was not well regulated like the banks. Strange....I have never heard about a mortgage brokerage having to pay and settlements or doing anything egregious. These guys planned this from the beginning, made out like bandits not once but twice under the tax paper bail out. Whats worse is they have become even further entrenched thanks to the CFPB according to the Congressmen who have penned bills that would do away with the rogue agency that is answerable to no one, and will make sure that they protect the mega banks like B of A. Seventeen billion to a bank this size is a proverbial slap on the wrist. There was a time when they would of been broken up into smaller more manageable institutions that actually served the communities instead of figuring out different ways to extract wealth from the tax payers. So they will have a one time write off on the share prices, but they will make it back and then some. Thomas Jefferson warned us about banks like these. Andrew Jackson on his death bed said his most proud accomplishment was he beat the central bankers and routed the den of vipers and thieves.

  • by William Matz | 8/20/2014 3:42:28 PM

    What is interesting is that BofA is admitting the MBS misrepresentations. That would seem to open the floodgates for mosre investor lawsuits, which have been mushrooming lately. The big question remains unanswered: Why did BofA go ahead w/ CW purchase after the AG lawsuit was known?

  • by Nick | 8/20/2014 6:33:40 PM

    Now you are as bad as Mr. Sanchez , The fact that B of A agrees to the fine does not mean they directly originated those mortgage , in fact Countrywide Wholesale is probably responsible for half those mortgages that where done through brokers


Should CFPB have more supervision over credit agencies?