April 17, 2014

BofA may settle over mortgage securities

April 18, 2014 – Bank of America is reportedly working on a multi-billion-dollar settlement with the Justice Department in response to the department's investigation into suspect mortgages the bank packaged into securities.

The Wall Street Journal reported that sources close to the negotiations say they have been going on for months and that Justice is pushing for a settlement figure that is billions more than the $2.4 billion in legal costs the bank says the mortgage issues have already required. If a settlement is not reached, the government may sue the bank. Another federal lawsuit against the bank over bad mortgages was dismissed.

Bank of America settled with the Federal Housing Finance Agency for $9.3 billion over similar issues last month. The government settled with JPMorgan Chase for $13 billion, in a similar negotiation last year.

Earlier this month, Reuters reported Bank of America was close to settling with the CFPB for as much as $800 million over allegedly deceptive advertising.