Bank of America has been put in a financial bind after a federal court judge found the corporation accountable for fraud over defective mortgages sold by its Countrywide division, according to RushHourDaily. The U.S. bank now owes $1.27 billion, and the monetary troubles are of rising concern for the unit.
U.S. District Judge Jed Rakoff found former Countrywide executive Rebecca Mairone guilty following defective loans given to “government-controlled mortgage companies Fannie Mae and Freddie Mac,” according to RushHourDaily.
“While the HSSL process lasted only nine months, it was from start to finish the vehicle for a brazen fraud by the defendants, driven by a hunger for profits and oblivious to the harms thereby visited, not just on the immediate victims but also on the financial system as a whole,” Rakoff wrote, according to CNBC.
The Wall Street Journal reported that Mairone is also in charge of paying $1 million that remains separate from the $1.27 billion. Rakoff gave strict instructions as to how Mairone was to pay the penalty from her own income due to her influential role in the deceitful process.
“Rebecca never intended to defraud anyone and never did defraud anyone. Unfortunately, more powerful people chose her as a scapegoat because they thought she was an easy target. We will fight on to clear her name,” said her lawyer Marc Mukasey, according to RushHourDaily.
Even still, Mairone’s future is not looking too bright. Bank of America will continue to fight for its reputation, however, and hopefully in due time, it will put an end to its financial crisis.
Image Credit: RushHourDaily/TIM CHONG
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