Bank of America’s Countrywide business must pay the United States regime $1.3bn (£769m) for selling defective home loans, a Incipient York judge has ruled.
Countrywide was found guilty of selling deplorable loans, as a component of a programme called “hustle”, to US mortgage giants Fannie Mae and Freddie Mac in 2007,the British Broadcasting Corporation reported
In October, a judge found the bank liable on a fraud charge but did not decide a penalty.
Former Countrywide executive Rebecca Mairone must additionally pay $1m.
“We believe that this figure simply bears no cognation to a circumscribed Countrywide programme that lasted several months and ended afore Bank of America’s acquisition of the company,” Bank of America spokesperson Lawrence Grayson told the BBC.
Bank of America bought Countrywide at the urging of the US regulators during the financial crisis in 2008.
“We’re reviewing the ruling and will assess our appellate options,” verbalized Mr Grayson.
Bank of America has spent proximately $40bn on licit matters relating to the housing market collapse, and the bank is expected to promulgate a multi-billion dollar settlement with US regulators over homogeneous charges in the coming weeks.
The “hustle” suit came about after Edward O’Donnell, a former Countrywide executive, issued a whistleblower complaint alleging fraud.
O’Donnell verbalized a programme Countrywide instituted in 2007 kenned internally as the “high-speed swim lane” (withal kenned as “HSSL” or “hustle”) did not opportunely screen mortgage applications, and that employees – who were paid predicated on loan volume and speed of processing – were give incentives to approve loans.
The programme was overseen by Mairone.
After investigating, the US regime found that 43 per cent of the imprests sold via the hustle programme to the US regime were defective in some way.
Investors – perhaps used to a near steady stream of settlements – did not react vigorously to news of the penalty. Shares in Bank of America were trading scarcely higher at midday
Meanwhile, the US economy grew at an annual rate of four per cent during the April-to-June period, latest figures relinquished by the US Department of Commerce have shown.
The magnification during the second quarter reverses the contraction optically discerned earlier in the year.
Countrywide was found guilty of selling deplorable loans, as a component of a programme called “hustle”, to US mortgage giants Fannie Mae and Freddie Mac in 2007,the British Broadcasting Corporation reported
In October, a judge found the bank liable on a fraud charge but did not decide a penalty.
Former Countrywide executive Rebecca Mairone must additionally pay $1m.
“We believe that this figure simply bears no cognation to a circumscribed Countrywide programme that lasted several months and ended afore Bank of America’s acquisition of the company,” Bank of America spokesperson Lawrence Grayson told the BBC.
Bank of America bought Countrywide at the urging of the US regulators during the financial crisis in 2008.
“We’re reviewing the ruling and will assess our appellate options,” verbalized Mr Grayson.
Bank of America has spent proximately $40bn on licit matters relating to the housing market collapse, and the bank is expected to promulgate a multi-billion dollar settlement with US regulators over homogeneous charges in the coming weeks.
The “hustle” suit came about after Edward O’Donnell, a former Countrywide executive, issued a whistleblower complaint alleging fraud.
O’Donnell verbalized a programme Countrywide instituted in 2007 kenned internally as the “high-speed swim lane” (withal kenned as “HSSL” or “hustle”) did not opportunely screen mortgage applications, and that employees – who were paid predicated on loan volume and speed of processing – were give incentives to approve loans.
The programme was overseen by Mairone.
After investigating, the US regime found that 43 per cent of the imprests sold via the hustle programme to the US regime were defective in some way.
Investors – perhaps used to a near steady stream of settlements – did not react vigorously to news of the penalty. Shares in Bank of America were trading scarcely higher at midday
Meanwhile, the US economy grew at an annual rate of four per cent during the April-to-June period, latest figures relinquished by the US Department of Commerce have shown.
The magnification during the second quarter reverses the contraction optically discerned earlier in the year.
