Bank of America Ordered to Pay Nearly $1.3 Billion in Mortgage Case
Source: NY Times
A federal judge has ordered Bank of America to pay nearly $1.3 billion in penalties for its role in defrauding Fannie Mae and Freddie Mac into buying thousands of defective mortgages, dealing yet another legal blow to a bank that was one of the main actors in the financial crisis.
The penalty handed down on Wednesday by Judge Jed S. Rakoff of the Federal District Court in Manhattan comes nine months after a jury found Bank of America liable for selling the questionable loans to Fannie and Freddie, the government-controlled mortgage finance giants, in the run up to the crisis.
The jury also found a top manager at Bank of Americas Countrywide Financial unit liable for the sale of the loans, which were originated as part of a program nicknamed the hustle. Federal prosecutors in Manhattan had argued that the Hustle program, which linked bonuses to how fast bankers could originate loans, led Countrywide to cut corners as it installed unqualified and inexperienced loan processors and tore down internal controls that were in place to root out risky borrowers.
The judge fined the former executive, Rebecca S. Mairone, $1 million for her role in the scheme.
FULL story at link.
Rebecca Mairone, a former manager at Countrywide, led a mortgage-writing program nicknamed the hustle.Credit Joshua Roberts/Bloomberg News, via Getty Images
Read more: http://dealbook.nytimes.com/2014/07/30/bank-of-america-ordered-to-pay-nearly-1-3-billion-in-mortgage-case/?_php=true&_type=blogs&_r=0
NutmegYankee
(16,170 posts)Babel_17
(5,400 posts)Utopian Leftist
(534 posts)Seriously, punishment does not fit the crime. Bank of America should rightfully have been destroyed by this. They're getting away with a slap on the wrist.
Bank of America should be OWNED by Americans outright by now. Wake up America, capitalism is so twentieth century! We need to try the banksters and nationalize the banks, just like Iceland did.
Baitball Blogger
(46,532 posts)valerief
(53,235 posts)jamzrockz
(1,333 posts)But now, I want to know who gets this money?
7962
(11,841 posts)freshwest
(53,661 posts)quakerboy
(13,893 posts)If she made enough to really be a player in all of this, then I doubt the fine will leave a mark.
And if it does, it seems likely she is not really the one at the heart of it.
freshwest
(53,661 posts)It wasn't like he was going to lose any of his property or anything. They love their money, especially if it's fast money, because it makes them feel clever.
Even if they don't get hit so hard they hit the streets it stings. It's not like any of them are going hungry. And I don't need to see that. They're being made an example of here.
DirkGently
(12,151 posts)bigwillq
(72,790 posts)For life.
Fortinbras Armstrong
(4,473 posts)Along with a number of her cohorts.
kemah
(276 posts)I you get busted ripping off $5 million you get fined $1 million. Nice career choice. Even the professional criminals now need a college education.
DeSwiss
(27,137 posts)...to show how progressive they are. Since they sacrificed a woman this time (it's the modern way virgins go instead of in the volcanoes now) The next one will no doubt, be a gay person of brown complexion, who is also differently-abled.
- So while the well-publicized gathering of the piglets in a basket is heralded, the REAL PIGS -- once gain -- go free. As it has thus forever been......
K&R
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OnlinePoker
(5,696 posts)Buried in this article from 2013 is the following:
The mortgage finance twins were on the hook for more than $1 billion in losses once the housing market crashed, according to the complaint. The Justice Department wants Bank of America to pay up to $848.2 million, the gross loss that it claims Fannie Mae and Freddie Mac suffered on the loans. U.S. District Judge Jed Rakoff must decide on the penalty.
http://www.economonitor.com/lrwray/2013/10/24/setting-the-record-straight-bofas-rebecca-mairone-convicted-of-fraud/