Bank Of America, Lawsuit | featured news

The $1-billion civil suit alleges that BofA's Countrywide fraudulently deceived mortgage finance giants Fannie Mae and Freddie Mac into believing the company's risky loans were safe and sound.

The Justice Department is expected to announce Wednesday a settlement with Bank of America Corp. that resolves accusations that its Countrywide Financial unit engaged in discriminatory mortgage-lending practices, according to a person familiar with the matter.

JPMorgan Chase & Co and Bank of America Corp were hit with new lawsuits by investors seeking to recover losses on $4.5 billion of soured mortgage debt, expanding the litigation targeting the two largest U.S. banks.

Top Bank of America Corp lawyers knew as early as January that American International Group Inc was prepared to sue the bank for more than $10 billion, seven months before the lawsuit was filed, according to sources familiar with the matter.

The insurer AIG is suing Bank of America Corp to recover more than $10 billion of losses from a "massive fraud" on mortgage debt, deepening the morass of litigation faced by the largest U.S. bank.

Allstate Corp has sued Bank of America Corp and 18 other defendants over losses it said it suffered on more than $700 million of mortgage debt it bought from Countrywide Financial Corp.

Bank of America Corp. violated Arizona's consumer fraud law by misleading consumers who tried to reduce their mortgage payments so they could keep their homes, state Attorney General Terry Goddard said Friday as he filed a civil lawsuit against the bank....

A group of investors in bankrupt Tribune Co sued JPMorgan, Merrill Lynch, Citicorp and Bank of America, claiming the banks arranged $3.7 billion in loans in 2007 they knew the company could never repay.

Permanent modifications, which lower mortgage payments to 31% of a borrower's pretax monthly income for five years, have been given to only about a third of the 1.3 million borrowers in trial plans since the program's launch in April 2009. Most of the lawsuits allege that the three- or four-month trial payment plans are contracts, and that Bank of America and other servicers broke them by not giving permanent modifications to homeowners who made their trial payments on time and provided the necessary documentation.

The attorney general accused the bank and two executives of securities fraud. Meanwhile, the bank settled an S.E.C. claim for $150 million.