Wednesday, December 21, 2011

Bank of America to pay $335 Million in settlement with US over Bias case

When looking from the outside of the US, it is still the place to look to for hope and promise of many people of the world.  However, after reading this article I doubt that it's as much an open society as it claims to be.

BofA in record settlement with US over bias case

$335 million settles charges that its Countrywide unit discriminated against minority homebuyers

Bank of America Corp's Countrywide Financial unit agreed on Wednesday to pay a record $335 million to settle civil charges that it discriminated against minority homebuyers, a historic settlement for the Obama administration in the wake of the subprime mortgage morass.
As the financial crisis was building in 2008, Bank of America bought Countrywide, which specialized in so-called subprime mortgages, focusing on loans to those with lower credit ratings and charging them higher interest rates.
The settlement covers conduct between 2004 and 2008 before the acquisition by Bank of America, and involves a range of alleged wrongdoing including charging African-Americans and Hispanics higher interest rates and fees and steering some to more expensive subprime mortgages.

"In today’s settlement with Countrywide Financial Corporation, we resolved the government’s allegations that Countrywide and its subsidiaries – which are now owned by Bank of America – engaged in discriminatory mortgage lending practices against more than 200,000 qualified African-American and Hispanic borrowers from 2004 through 2008," U.S. Attorney General Eric Holder said in a statement.
Holder said that the investigation found a widespread pattern of discrimination in more than 180 geographic markets across 41 states and the District of Columbia.
"These allegations represent alarming conduct – by one of the largest mortgage lenders in this country, during the height of the housing market boom," he added.
The money will be used to compensate victims of Countrywide's discriminatory mortgage loans from 2004 through 2007.

Reuters and The Associated Press contributed to this report.

No comments:

Post a Comment