News / Economy

    Bank of America to Pay $16 Billion to Settle Mortgage Cases

    A combination of file photos shows U.S. Attorney General Eric Holder (L) in Washington on May 5, 2014 and Bank of America Chief Executive Brian Moynihan in Hong Kong on March 8, 2013 respectively.
    A combination of file photos shows U.S. Attorney General Eric Holder (L) in Washington on May 5, 2014 and Bank of America Chief Executive Brian Moynihan in Hong Kong on March 8, 2013 respectively.
    VOA News

    U.S. news outlets say Bank of America has agreed to pay over $16 billion to settle the federal government's investigation into its sale of mortgage-backed securities, the investment vehicle largely blamed for the 2008 financial crisis.

    The reports say a tentative agreement was reached last week during a phone call between Bank of America chairman Brian Moynihan and U.S. Attorney General Eric Holder. Details of the agreement are still being worked out, but sources say Bank of America will pay $9 billion in cash, with the remaining money being used to help struggling homeowners.

    Federal prosecutors have been investigating Bank of America over its acquisitions of Countrywide Bank and investment firm Merrill Lynch, which together held about $965 billion in mortgage-backed securities. The securities included so-called subprime home loans taken out by homeowners who were unable to maintain the payments.

    The poor quality of the loans led to huge losses for investors who bought mortgage-backed securities, as well as a wave of foreclosures on delinquent homeowners, which led to the worst economic downturn since the Great Depression of the 1930s.

    The settlement by Bank of America is the largest reached with the federal government in connection with the toxic securities. The Justice Department has already reached multi-billion dollar settlements with two other major U.S. banks, JPMorgan Chase and Citigroup.

    But consumer advocacy groups have criticized the government for failing to bring criminal charges against these financial firms, or their executives, who sold the faulty mortgages to unsuspecting consumers.

    You May Like

    Turkey, US Splits Deepen Over Support for Kurdish Militants

    Ankara summons American ambassador to protest remarks by State Department spokesman who said Washington does not consider Syria's Kurdish Democracy Union Party (PYD) a terrorist organization

    Obama Seeking $19 Billion for National Cybersecurity

    Move, touted as attempt to build broad, cohesive federal response to cyberthreats, calls for increase in cybersecurity spending across all government agencies

    Video Foreign Policy Weighs Heavy for Some US Voters

    VOA talks to protesters in Manchester, New Hampshire, who sound off on foreign policy issues such as the Guantanamo Bay prison, the Israeli-Palestinian conflict and the wars in Iraq, Syria and Yemen

    This forum has been closed.
    Comment Sorting
    Comments
         
    by: goldenpanther from: Rockville, MD
    August 07, 2014 7:54 AM
    BOA is still getting off through a very light sentence. Criminal charges would be a more effective way to go. The amount of damage done to the equity in people's homes because of the manipulations by the banking industy probably goes 10 times beyond that. And it will take many more years for the housing industry to recover if it ever does. Realtors will tell you that there is a low inventory of homes for sale but the real truth is there is a far less number of buyers that are willing to try the more restrictive rules. These new rules were generated because the banking industry couldn't control itself. Interest rates are lower than when the housing bubble burst; that should tell you something also.

    by: Mike Martin from: Lakewood, co
    August 07, 2014 7:32 AM
    I lost $120k with my Florida house over this mess. Where do I go to get my cut of this 16 billion?

    by: Frank Nelson from: Chicago
    August 07, 2014 6:37 AM
    If the Executives cannot be punished, then there should be a Corporate DEATH SENTENCE, where a Corporation is fined the entire worth of the Company!

    by: William from: Memphis
    August 07, 2014 6:21 AM
    FINES are passed on to customers, eventually. PRISON IS THE ONLY WAY YOU WILL GET REAL CHANGE IN BEHAVIOR !

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Valentine's Day Stinks for Lebanese Clownsi
    X
    February 09, 2016 8:04 PM
    This weekend, on Valentine's Day in Lebanon, love is not the only thing in the air. More than half a year after the country's trash crisis began, the stink of uncollected garbage remains on the streets. Step forward "Clown Me In," a group of clowns who use their skills for activism. Before the most romantic day of the year the clowns have released their unusual take on love in Lebanon -- in a bid to keep the pressure up and get the trash off the streets. John Owens reports from Beirut.
    Video

    Video Valentine's Day Stinks for Lebanese Clowns

    This weekend, on Valentine's Day in Lebanon, love is not the only thing in the air. More than half a year after the country's trash crisis began, the stink of uncollected garbage remains on the streets. Step forward "Clown Me In," a group of clowns who use their skills for activism. Before the most romantic day of the year the clowns have released their unusual take on love in Lebanon -- in a bid to keep the pressure up and get the trash off the streets. John Owens reports from Beirut.
    Video

    Video Rocky Year Ahead for Nigeria Amid Oil Price Crash

    The global fall in the price of oil has rattled the economies of many petroleum exporters, and Africa’s oil king Nigeria is no exception. As Chris Stein reports from Lagos, analysts are predicting a rough year ahead for the continent’s top producer of crude.
    Video

    Video Foreign Policy Weighs Heavy for Some US Voters

    VOA talks to protesters in Manchester, New Hampshire who sound off on foreign policy issues such as the Guantanamo Bay Prison, the Israeli-Palestinian conflict, Middle East Affairs and national security.
    Video

    Video 'No Means No' Program Targets Sexual Violence in Kenya

    The organizers of an initiative to reduce and stop rape in the informal settlements around Kenya's capital say their program is having marked success. Girls are taking self-defense classes while the boys are learning how to protect the girls and respect them. Lenny Ruvaga reports from Nairobi.
    Video

    Video New Hampshire Voters Are Independent, Mindful of History

    Once every four years, the northeastern state of New Hampshire becomes the center of the U.S. political universe with its first-in-the-nation presidential primary. What's unusual about New Hampshire is how seriously the voters take their role and the responsibility of being among the first to weigh in on the candidates.
    Video

    Video Chocolate Lovers Get a Sweet History Lesson

    Observed in many countries around the world, Valentine’s Day is sometimes celebrated with chocolate festivals. But at a festival near Washington, the visitors experience a bit more than a sugar rush. They go on a sweet journey through history. VOA’s June Soh takes us to the festival.
    Video

    Video 'Smart' Bandages Could Heal Wounds More Quickly

    Simple bandages are usually seen as the first line of attack in healing small to moderate wounds and burns. But scientists say new synthetic materials with embedded microsensors could turn bandages into a much more valuable tool for emergency physicians. VOA’s George Putic reports.
    Video

    Video Bhutanese Refugees in New Hampshire Closely Watching Primary Election

    They fled their country and lived in refugee camps in neighboring Nepal for decades before being resettled in the northeastern U.S. state of New Hampshire -- now the focus of the U.S. presidential contest. VOA correspondent Aru Pande spoke with members of the Bhutanese community, including new American citizens, about the campaign and the strong anti-immigrant rhetoric of some of the candidates.
    Video

    Video Researchers Use 3-D Printer to Produce Transplantable Body Parts

    Human organ transplants have become fairly common around the world in the past few decades. Researchers at various universities are coordinating their efforts to find solutions -- including teams at the University of Pennsylvania and Rice University in Houston that are experimenting with a 3-D printer -- to make blood vessels and other structures for implant. As VOA’s Greg Flakus reports from Houston, they are also using these artificial body parts to seek ways of defeating cancerous tumors.
    Video

    Video Helping the Blind 'See' Great Art

    There are 285 million blind and visually impaired people in the world who are unable to enjoy visual art at a museum. One New York photographer is trying to fix this situation by making tangible copies of the world’s masterpieces. VOA correspondent Victoria Kupchinetsky was there as visually impaired people got a feel for great art. Joy Wagner narrates her report.
    Video

    Video German Artists to Memorialize Refugees With Life Jacket Exhibit

    Sold in every kind of shop in some Turkish port towns, life jackets have become a symbol of the refugee crisis that brought a million people to Europe in 2015.  On the shores of Lesbos, Greece, German artists collect discarded life jackets as they prepare an art installation they plan to display in Germany.  For VOA, Hamada Elrasam has this report from Lesbos, Greece.
    Video

    Video E-readers Help Ease Africa's Book Shortage

    Millions of people in Africa can't read, and there's a chronic shortage of books. A non-profit organization called Worldreader is trying to help change all that one e-reader at a time. VOA’s Deborah Block tells us about a girls' school in Nairobi, Kenya where Worldreader is making a difference.
    Video

    Video Genius Lets World Share Its Knowledge

    Inspired by crowdsourcing companies like Wikipedia, Genius allows anyone to edit anything on the web, using its web annotation tool
    Video

    Video In Philippines, Mixed Feelings About Greater US Military Presence

    In the Philippines, some who will be directly affected by a recent Supreme Court decision clearing the way for more United States troop visits are having mixed reactions.  The increased rotations come at a time when the Philippines is trying to build up its military in the face of growing maritime assertiveness from China.  From Bahile, Palawan on the coast of the South China Sea, Simone Orendain has this story.

    World Currencies

    EUR
    USD
    0.8899
    JPY
    USD
    114.87
    GBP
    USD
    0.6937
    CAD
    USD
    1.3904
    INR
    USD
    68.044

    Rates may not be current.