Related Federal Cases
- Bank of America, Mortgage-Backed Securities Fraud, North Carolina 2013 · New York
- Bank of America, Mortgage-Backed Securities Fraud, North Carolina 2013 · New York
- Bank of America, Mortgage-Backed Securities Fraud, North Carolina 2013 · New York
- Bank of America, Mortgage-Backed Securities Fraud, North Carolina 2013 · New York
- Bank of America, Mortgage-Backed Securities Fraud, North Carolina 2013 · New York
Bank of America Sued for Mortgage-Backed Securities Fraud in North Carolina
CHARLOTTE, N.C. – The United States has filed a civil lawsuit against Bank of America Corporation and certain of its affiliates, including Merrill Lynch, Pierce, Fenner & Smith f/k/a/ Banc of America Securities, LLC, Bank of America, N.A., and Banc of America Mortgages Securities, Inc. (collectively “Bank of America”) for defrauding investors in connection with the sale of over $850 million of residential mortgage-backed securities.
The complaint alleges that Bank of America lied to investors about the relative riskiness of the mortgage loans backing the residential mortgage-backed securities (RMBS), made false statements after intentionally not performing proper due diligence and filled the securitization with a disproportionate amount of risky mortgages originated through third party mortgage brokers.
“Today’s filing marks the latest step forward in the Justice Department’s ongoing efforts to hold accountable those who engage in fraudulent or irresponsible conduct,” said Attorney General Eric Holder. “As this action proves, President Obama’s Financial Fraud Enforcement Task Force will continue to take an aggressive approach to combating financial fraud and uncovering abuses in the residential mortgage-backed securities market.
U.S. Attorney Anne M. Tompkins said, “Bank of America’s reckless and fraudulent origination and securitization practices in the lead-up to the financial crisis caused significant losses to investors. Now, Bank of America will have to face the consequences of its actions.”
New York Attorney General Eric Schneiderman said, “I applaud Attorney General Holder for taking this important step toward holding Bank of America accountable for packaging and selling toxic loans to investors and brokers, a key cause of the housing collapse that crashed our economy and still plagues communities to this day.”
A residential mortgage-backed security is a bond backed by a pool of residential mortgages.
The U.S. Securities and Exchange Commission (SEC) has filed civil charges in federal court in Charlotte, N.C. against Bank of America for defrauding investors.
Key Facts
- State: North Carolina
- Category: Financial Crimes
- Source: DOJ Press Release ↗
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