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Friday, August 22, 2014

Bank of America's $17B Settlement With Justice Department

The government has reached a $16.65 billion settlement with Bank of America over its role in the sale of mortgage-backed securities in the run-up to the financial crisis, the Justice Department announced Thursday.

The deal calls for the bank, the second-largest in the U.S., to pay a $5 billion cash penalty and provide billions of dollars of relief to struggling homeowners. Bank of America said its cash payouts will total $9.65 billion.

The settlement is by far the largest deal the Justice Department has reached with a bank over the 2008 mortgage meltdown. In the last year, JPMorgan Chase & Co. agreed to a $13 billion settlement while Citigroup reached a separate $7 billion deal.

Maryland Attorney General Doug Gansler announced today that multiple governmental entities and pension programs (Maryland and local governments) will share an estimated $75 million settlement secured by his Securities Division.



Anonymous said...

Keep in mind these are fines. Penalties. These banks have been proven to engage in fraud against the American public.

They pay money to the government (why?) and a pittance of their profits to some of their existing customers who have mortgages with them.

This is criminal behavior by international corporations.

Our government is owned by them.

Anonymous said...

"... pay a $5 billion cash penalty and provide billions of dollars of relief to struggling homeowners. "

How about taking most of those 5 billion cash penalty dollars and putting it toward making it right for those struggling homeowners? After all, how did government help them when they were drowning in debt they couldn't afford, sold to them with your quiet blessing. And what's 5 billion to the government, anyway?

Anonymous said...

In keeping up with the Jones People now have houses they can't afford, so its the banks fault.

Anonymous said...

The banks cost us trillions. They get fined a few billion. Nobody ever goes to jail.

I don't understand why the government claims it's too expensive to prosecute these cases. How many lawyers could you hire when you can make tens or hundreds of billions of extra dollars going to court? Take a couple of these banks down and throw their directors in jail, and the remaining ones would straighten up really quick.

Anonymous said...

No one went to jail. No bank officials even in orange jump suits going to trial.

The "fines" were a payoff and a cost of doing business.

Beyond outrageous.

Anonymous said...

extortion! what are Jamie Gorelik and Franklin Raines up to these days?

Anonymous said...

Just want to be clear now the government enacts so called fair housing laws (glass stiegel 1998) which force these banks to loan anybody anything they want, Barney Frank and chris Dodd are repeatedly warned of this problem and they refuse to do anything about it but its the banks fault. The government has done a great job spinning this one based on these comments

Anonymous said...

This money should go directly to homeowners who lost their home through foreclosure.