SALON

Wednesday, Oct 24, 2012 4:55 PM UTC

U.S. sues Bank of America for mortgage fraud

The filing is the latest in recent series of government civil suits against Wall Street giants

By

Topics: Bank of America, Mortgage Fraud, Financial Crisis, Foreclosures, Fraud, Wall Street, Mortgage Crisis, Civil Suit, ,

U.S. sues Bank of America for mortgage fraud (Credit: Shutterstock)

The Department of Justice sued Bank of America for mortgage fraud Wednesday, in the latest in a series of civil fraud suits filed by the U.S. government against major banks. According to a breaking Reuters report, the complaint filed in Manhattan accuses the banking giant of “deliberately generating and then selling thousands of toxic home loans that later defaulted to Fannie Mae and Freddie Mac.”

According to U.S. Attorney Preet Bharara, these loan sales resulted in “countless” foreclosures and over $1 billion in losses. As Salon noted in early October, the U.S. filed a fraud complaint against Wells Fargo and, in September, a joint federal and state task force sued JPMorgan Chase for deceptive practices related to the sale of mortgage-backed securities. All of these suits, including today’s BofA filing, are civil and may result in monetary penalties for banks, but no jail time for bankers.

As I wrote following the Wells Fargo complaint filing, “although many welcome the government going after Wall Street, critical pundits have raised questions about the timing, noting that the Obama administration might be projecting a tough-on-banks stance with the election countdown in mind.”

Natasha Lennard is an assistant news editor at Salon, covering non-electoral politics, general news and rabble-rousing. Follow her on Twitter @natashalennard, email nlennard@salon.com. More Natasha Lennard.

Next Article

Related Stories

More Related Stories

Featured Slide Shows

The week in 10 pics

close X
  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11
  • This photo. President Barack Obama has a laugh during the unveiling of the George W. Bush Presidential Center in Dallas, Tx., Thursday. Former first lady Barbara Bush, who candidly admitted this week we've had enough Bushes in the White House, is unamused.
    Reuters/Jason Reed

  • Rescue workers converge Wednesday in Savar, Bangladesh, where the collapse of a garment building killed more than 300. Factory owners had ignored police orders to vacate the work site the day before.
    AP/A.M. Ahad

  • Police gather Wednesday at the Massachusetts Institute of Technology to honor campus officer Sean Collier, who was allegedly killed in a shootout with the Boston Marathon bombing suspects last week.
    AP/Elise Amendola

  • Police tape closes the site of a car bomb that targeted the French embassy in Libya Tuesday. The explosion wounded two French guards and caused extensive damage to Tripoli's upscale al-Andalus neighborhood.
    AP/Abdul Majeed Forjani

  • Protestors rage outside the residence of Indian Prime Minister Manmohan Singh Sunday following the rape of a 5-year-old girl in New Delhi. The girl was allegedly kidnapped and tortured before being abandoned in a locked room for two days.
    AP/Manish Swarup

  • Clarksville, Mo., residents sit in a life boat Monday after a Mississippi River flooding, the 13th worst on record.
    AP/Jeff Roberson

  • Workers pause Wednesday for a memorial service at the site of the West, Tx., fertilizer plant explosion, which killed 14 people and left a crater more than 90 feet wide.
    AP/The San Antonio Express-News, Tom Reel

  • Aerial footage of the devastation following a 7.0 magnitude earthquake in China's Sichuan province last Saturday. At least 180 people were killed and as many as 11,000 injured in the quake.
    AP/Liu Yinghua

  • On Wednesday, Hazmat-suited federal authorities search a martial arts studio in Tupelo, Miss., once operated by Everett Dutschke, the newest lead in the increasingly twisty ricin case. Last week, President Barack Obama, Sen. Roger Wicker, R.-Miss., and a Mississippi judge were each sent letters laced with the deadly poison.
    AP/Rogelio V. Solis

  • The lighting of Freedom Hall at the George W. Bush Presidential Center Thursday is celebrated with (what else but) red, white and blue fireworks.
    AP/David J. Phillip

  • Recent Slide Shows

  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11

Related Videos

Comments

 1 Comments

Comment Preview

Your name will appear as username

You may use these HTML tags and attributes: <a href=""> <b> <em> <strong> <i> <blockquote>

follow salon

Most Read

Popular on Reddit

links from salon.com

From Around the Web

Presented by Scribol
listener_new_rect The Listener: "The Shelter Cycle": Raised in a cult

Recommendations