US govt sues Bank of America for defrauding investors prior to housing crash — RT Business

US govt sues Bank of America for defrauding investors prior to housing crash — RT Business:

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The US government has filed two lawsuits against Bank of America accusing the company of defrauding investors by massively underestimating the quality of mortgage-backed securities prior to the 2008 housing market crash and US recession.

The US Security Exchange Commission (SEC) and Justice Department each filed a lawsuit in US District Court in Charlotte, North Carolina on Tuesday, accusing Bank of America of knowingly minimizing the risk associated with $850 million worth of securities backed by residential mortgages.

“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,” New York Attorney General Eric Schneidermann said in a statement."

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