{"id":5485,"date":"2013-08-17T00:00:00","date_gmt":"2013-08-17T05:00:00","guid":{"rendered":"https:\/\/institutionalinvestorsecuritiesblog.blawgcloud.com\/2013\/08\/sec_and_doj_sue_bank_of_americ_1"},"modified":"2022-05-04T14:29:02","modified_gmt":"2022-05-04T19:29:02","slug":"sec-and-doj-sue-bank-of-americ-1","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/sec-and-doj-sue-bank-of-americ-1\/","title":{"rendered":"SEC and DOJ Sue Bank of America Over Alleged $850M RMBS Fraud"},"content":{"rendered":"

Bank of America (BAC) <\/a>and two subsidiaries are now facing SEC charges for allegedly bilking investors in an residential mortgage-backed securities<\/a> offering that led to close to $70M in losses and about $50 million in anticipated losses in the future. The US Department of Justice also has filed its securities lawsuit over the same allegations.<\/p>\n

In its securities lawsuit, submitted in U.S. District Court for the Western District of North Carolina, the Securities and Exchange Commission contends that the bank, Bank of America Mortgage Securities (BOAMS) and Banc of America Securities LLC, which is now known as Merrill Lynch, Pierce, Fenner & Smith, conducted the RMBS offering, referred to as the the BOAMS 2008-A and valued at $855 million, in 2008. The securities was sold and offered as \u201cprime securitization suitable for the majority of conservative RMBS investors.<\/p>\n

However, according to the regulator, Bank of America misled investors about the risks and the mortgages\u2019 underwriting quality while misrepresenting that the mortgage loans backing the RMBS were underwritten in a manner that conformed with the bank\u2019s guidelines. In truth, claims the SEC, the loans included income statements that were not supported, appraisals that were not eligible, owner occupancy-related misrepresentations, and evidence that mortgage fraud was involved. Also, says the regulator, the ratio for original-combined-loan-to-value and debt-to-income was not calculated properly on a regular basis and, even though materially inaccurate, it was provided to the public.<\/p>\n

Continue Reading \u203a<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"

Bank of America (BAC) and two subsidiaries are now facing SEC charges for allegedly bilking investors in an residential mortgage-backed securities offering that led to close to $70M in losses and about $50 million in anticipated losses in the future. The US Department of Justice also has filed its securities lawsuit over the same allegations. […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3751,3752,3757,3760,3761],"tags":[],"class_list":["post-5485","post","type-post","status-publish","format-standard","hentry","category-bank-of-america","category-financial-firms","category-mortgagebacked-securities","category-sec-enforcement","category-securities-and-exchange-commis"],"yoast_head":"\nSEC and DOJ Sue Bank of America Over Alleged $850M RMBS Fraud — Investor Lawyers Blog — August 17, 2013<\/title>\n<meta name=\"description\" content=\"Bank of America (BAC) and two subsidiaries are now facing SEC charges for allegedly bilking investors in an residential mortgage-backed securities — August 17, 2013\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link 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