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Omaha Steve

(98,872 posts)
Wed Jul 30, 2014, 08:33 PM Jul 2014

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 America’s 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

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Bank of America Ordered to Pay Nearly $1.3 Billion in Mortgage Case (Original Post) Omaha Steve Jul 2014 OP
It's a pittance, but it is a start! NutmegYankee Jul 2014 #1
Agreed (nt) Babel_17 Jul 2014 #4
Is that all?? Utopian Leftist Jul 2014 #2
It's a start. Baitball Blogger Jul 2014 #3
IF they pay it back, I'm sure they'll take longer than Exxon did for the Valdez oil spill. nt valerief Jul 2014 #5
Good jamzrockz Jul 2014 #6
Can we get someone to do some time now? Even just a little? nt 7962 Jul 2014 #7
Rebecca wasn't 'too big to fail!' That $1M fine is gonna leave a mark. freshwest Jul 2014 #8
Will it? quakerboy Jul 2014 #11
Worked for a multimillionaire who lost a mil in one day on the market. He stayed drunk for 3 days. freshwest Jul 2014 #12
Interesting an individual was actually fined. n/t DirkGently Jul 2014 #9
These folks need to be in prison. bigwillq Jul 2014 #10
Maybe not for life, but why isn't that woman in prison? Fortinbras Armstrong Jul 2014 #13
White collar crime is now looking like a career choice kemah Jul 2014 #14
I figured they'd find themselves a fall-guy or gal..... DeSwiss Jul 2014 #15
$450 Million more than Freddie's and Fannie's loss on the loans OnlinePoker Jul 2014 #16

Utopian Leftist

(534 posts)
2. Is that all??
Wed Jul 30, 2014, 08:43 PM
Jul 2014

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.

quakerboy

(13,893 posts)
11. Will it?
Thu Jul 31, 2014, 04:14 AM
Jul 2014

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)
12. Worked for a multimillionaire who lost a mil in one day on the market. He stayed drunk for 3 days.
Thu Jul 31, 2014, 05:34 AM
Jul 2014

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.

kemah

(276 posts)
14. White collar crime is now looking like a career choice
Thu Jul 31, 2014, 09:56 AM
Jul 2014

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)
15. I figured they'd find themselves a fall-guy or gal.....
Thu Jul 31, 2014, 10:39 AM
Jul 2014

...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

[center][/center]

OnlinePoker

(5,696 posts)
16. $450 Million more than Freddie's and Fannie's loss on the loans
Thu Jul 31, 2014, 04:44 PM
Jul 2014

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/

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