The Department of Justice had until Monday to ask the U.S. Supreme Court to take up its “Hustle” lawsuit against the Charlotte-based bank. In May, the 2nd U.S. Circuit Court of Appeals reversed findings against the bank in the 2012 case, the first civil fraud suit brought by the Justice Department over home loans sold to mortgage giants Fannie Mae and Freddie Mac.
A Justice Department spokeswoman did not comment on the decision to let Monday’s deadline pass. A Bank of America spokesman also declined to comment.
Named after a program at Countrywide Financial, acquired by Bank of America in 2008, the case was initially brought by former Countrywide executive Ed O’Donnell under a federal whistleblower statute.
The government, which took over the case, claimed Hustle rapidly processed loans without regard for their quality in the run-up to the financial crisis, resulting in thousands of fraudulent loans being sold to Fannie and Freddie and later defaulting. Countrywide marketed the “toxic products” as investment grade despite their poor quality, the government alleged, calling Hustle a “spectacularly brazen” loan-origination program.
In 2014, a federal judge ruled in the case that Bank of America should pay $1.27 billion in civil penalties and that former Countrywide executive Rebecca Mairone should pay $1 million. That ruling came after a jury’s findings against the bank and Mairone.
But in this year’s ruling, a three-judge panel of the appeals court overturned the jury’s findings and tossed out the penalties against the bank and Mairone. The judges said there was insufficient evidence that Countrywide committed mail and wire fraud in late 2007 and 2008.
That decision delivered a blow to the Obama administration’s attempts to hold financial institutions accountable for their role in the financial crisis.
The government then asked the appeals court to reconsider its decision, but that request was denied.
Read more here: http://www.charlotteobserver.com/news/business/banking/bank-watch-blog/article116470198.html#storylink=cpy
13 thoughts on “Feds allow high-profile case against Bank of America to quietly fizzle out”
Of course they did. Are we any closer to stopping this years later?
Hope Mr. Trump go after B of A to make America great again. He once said, people need homes. I very much agree that
“That decision delivered a blow to the Obama administration’s attempts to hold financial institutions accountable for their role in the financial crisis.”
BS!!! What attempts? FTG!!!
Yet people are up in arms that we have a new president?Go figure,anything is better than the crooks that have been robbing our country and our pockets for the last 8 years.
Its truly a disgusting thing that has been allowed to go on and still goes on today.
Need help, I am putting together some case documentation against Wells Fargo and US Bank as Trustee. Can someone tell me how I can find all of the illegal DOT’s that are in public records. Looking specifically for Securitized Trust DOT’s. You can reach me at 443-677-2799 or jsmith5915@msn.com
Ronda, you are exactly correct in your summation. Don’t know your situation, but Bankruptcy Court is the place to take a fraud claim.
Now it didn’t “work” for me, but that is ALLEGEDLY the correct forum. They will blow up your short sale if they can, and I’m not sure why they do that. I think it’s to “wash” the title between themselves so it appears marketable.
Stan, Sheri, I’m convinced the DOJ, FBI, the BK Trustees, ALL of the Justice Department (under the direction and control of the Treasury and Fed) have been instructed to IGNORE all the fraud against homeowners and protect the banking system. They’re damning the investors as well, although some are still getting paid off the Ponzi.
Some of these cases are real “no-brainers”, and the judges speak in circular logic to prevent homeowners from obtaining justice.
Hello Neil A shirt sale offer was made to BofA to remedy an underwater mortgage. The offer was made in July and BofA ha been sitting on it. November is here and they sold the note or a new services. Buyers for the short sale are patiently waiting. I fear BofA has collected insurance on the loan and now the new service is running up the debt to do the same. Am I on the right track or needlessly worrying? It’s my friends house. I just got a court to deny my foreclosure where Wells Fargo refused to modify and misled me into an inhouse mod that piled on interest and fees. I will have to sue the bank for fraud to complete justice. Thank you for posting your website it has helped me tremendously. I don’t understand it all but I’m learning. Ronda Scott
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Further overt evidence of colllusion btwn govt and lenders; homeowners rights stolen while they both profit. Rescission laws, fraud,,,,all ignored.
Reblogged this on Deadly Clear and commented:
Doesn’t anybody remember where the 2012 Democratic National Convention was held…? …in Charlotte, North Carolina home of Bank of America HQ. Are we really surprised?
Well let’s be frank. Obama had the largest super pac of anyone previously all funded by the banks. Everything that’s been done thus far has been for appearances only. When Obama named Jamie diamond to advise him I knew we’d been had. “Yes we can” quickly became ” oh crap I can’t believe I drank the cool aide”
How is FNMA a victim when in actuality they are a partner in the sham known as the GSE Business Model which was designed in the event of an implosion to tap the taxpayers?
The DOJ appears to simply not be interested in holding the banks accountable.
Reblogged this on California Freelance Paralegal and commented:
That is outrageous that the Department of Justice failed to appeal this decision to the United States Supreme Court.