Bank of America to Settle $16.65 Billion Mortgage Case
The Justice Department is poised to announce a $16.65 billion settlement with Bank of America over accusations that it duped investors into buying toxic mortgage securities, say people briefed on the matter.
Yet even as that accord nears completion, prosecutors are preparing a separate civil case against Angelo Mozilo, the man who came to embody the risk-taking for which Bank of America is now paying dearly, a rare move against a senior executive at the center of the financial crisis.
The deal would resolve more than two dozen investigations from prosecutors across the country, the people briefed on the matter said.
The prosecutors in Los Angeles are preparing a lawsuit against Mr. Mozilo, Countrywide’s co-founder, while no bank executives will face charges as part of the settlement. Mr. Mozilo, who previously reached a $67.5 million settlement with the Securities and Exchange Commission, was an early target of the Justice Department.
In a statement, Mr. Mozilo’s lawyer, David Siegel, said that he would “not comment on reported rumors concerning any investigation.”
Yet the Bank of America deal — some of whose details have emerged in recent weeks — has already drawn criticism for what it lacks. In lieu of lawsuits from various United States attorney offices, the deal will include a statement of facts that outlines the bank’s misconduct in only the broadest of terms.
Source: NYT
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