REPORT: Bank Of America Is Looking At A Record $US17 Billion Settlement With The Feds Over Mortgage Fraud Claims

The Wall Street Journal’s Andrew Grossman, Christina Rexrode and Dan Fitzpatrick report Bank of America is nearing a settlement with the Justice Department for up to $US17 billion over mortgage fraud claims stemming from the financial crisis.

That amount would be a record for a civil settlement between the U.S. government and a private firm, the paper says.

In January 2008, Bank of America purchased Countrywide, the firm most analysts regard as having led the nation’s subprime mortgage industry off a cliff. Last week, a federal judge imposed a fine of $US1.3 on Bank of America over charges related to Countrywide loans sold to Fannie Mae and Freddie Mac.

If the Justice Department reaches the $US17 billion mark, the Justice Department will have racked up $US37 billion in penalties between JP Morgan, Citibank and Bank of America.

Bank of America shares are up 0.2% in after-hours trading.

Read the full report at WSJ.com ยป

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