Abayomi Azikiwe, editor of the Pan-African News Wire, covering a demonstration organized by the Moratorium NOW! Coalition on May 29, 2009 in downtown Detroit. (Photo: Alan Pollock), a photo by Pan-African News Wire File Photos on Flickr.
Filing: Bank of America may face civil charges
AP 6:53 p.m. EDT August 1, 2013
Bank of America may be facing civil charges over mortgage backed securities and other mortgage-related matters.
The bank said in a regulatory filing Thursday that the Department of Justice told the company that it intends to file civil charges related to one or two jumbo-prime securitizations. The SEC is also considering filing civil charges against Merrill Lynch tied to a collateralized debt obligation investigation.
Banks used to regularly package mortgages into bundles known as CDOs, or collateralized debt obligations, and then sell them off in pieces to investors. Many went sour when the housing market collapsed.
Additionally, the filing said that the New York Attorney General's office intends to file action against Merrill Lynch, following an investigation of some of its residential mortgage backed securities.
Asked for comment, Bank of America spokesman Larry Di Rita said: "We've made progress putting many of the issues behind us and we'll continue to work to put the remainder of them behind us."
Bank of America said that it is fully cooperating with the investigations.
"The Corporation has been in active discussions with senior staff of each government entity in connection with the respective investigations and to explain why the threatened civil charges are not appropriate," the filing says.
News about the agencies' contact with the Charlotte-based bank was on page 218 of the company's quarterly earnings report.
Bank of America stock gained 2.4% to $14.95 in regular trading Thursday.
Contributing: USA TODAY's Paul Davidson, Gary Strauss