Bank of America Sued by U.S. Attorney for $1 Billion+ for Fraud

by Isaac Benmergui, Esq on November 2, 2012

Bank of America is in trouble again. This time the U.S. Attorney in Manhattan filed suit against the BOA for more than $1 billion alleging a multi-year mortgage fraud against Fannie Mae and Freddie Mac. The same U.S. Attorney also recently filed suit against Wells Fargo alleging civil mortgage fraud.

The Manhattan U.S. Attorney Preet Bharara alleges “Countrywide,” which was purchased by Bank of America in 2008, designed procedures whereby mortgage loans could be processed at high speeds, which resulted in loans unverified for their soundness. Thousands of fraudulent loans were generated.

“Potentially, the government may amend its complaint to include individuals, present or former employees of Bank of America,” Assistant U.S. Attorney Pierre Armand told U.S. District Judge Jed Rakoff. Following the motto “Loans Move Forward, Never Backward,” mortgage executives tried to eliminate the normal checks and balances of offering loans.

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