Bank of America has been sued by the United States Justice Department for $1 Billion. The lawsuit alleges mortgage fraud. The complaint alleges that Countrywide (now owned by Bank of America) engaged in widespread falsification of information, failed to use underwriters and was more interested in quantity than quality. The lawsuit also alleges that executives at Countrywide were aware of these practices.
Bank of America purchased Countrywide in 2008. This is going to be a lawsuit to watch. It is the first lawsuit to be brought by the U.S. Department of Justice on behalf of Fannie Mae (Federal National Mortgage Association) and Freddie Mac (Federal Home Loan Mortgage Corporation).
What I don't understand is why the government is only asking for a billion dollars in damages?
I would be willing to bet that there was over $1 billion in fraud just in Florida alone. Of course, the only empirical evidence to support my last statement is the devastation of my clients’ lives, which I have witnessed in my office. Let's say that there is a settlement and the government gets a check from Bank of America for $1 billion. Where does that money go? Does it go to the homeowner who lost his home?
As I said, folks, this is going to be one to watch. I wonder who will be next. Wells Fargo, Citibank…? Does anyone think that the timing of this lawsuit has anything to do with the election?
This post was submitted by Carmen Dellutri, Esq., founder of The Dellutri Law Group, P.A. Currently, the firm has offices in Port Charlotte, Fort Myers, Naples. Mr. Dellutri also sits on the Board of American Board of Certification. Mr. Dellutri is also one of the founders of the Bankruptcy Law Network, Debt Law Network, Credit Law Network, and Mortgage Law Network. Mr. Dellutri also writes for the firm's personal injury litigation blog, www.faircreditreportingactblog.com and www.fairdebtcollectionpracticesactblog.com, and the firm's mortgage modification blog.