In a recent turn of events, the United States Government asked that Bank of America pay them damage charges of roughly $863.6 million after they were found liable for fraud over defective mortgages sold by their Countrywide Financial unit.

The file was set on Friday, with additional penalties against former midlevel executive, Rebecca Mairone, who the federal jury also found liable.

From the L.A. Times: 

“The government said the penalties were necessary to punish the bank and Ms. Mairone “and to send a clear and unambiguous message that mortgage fraud for profit will not be tolerated.” Judge Jed S. Rakoff, who presided over the four-week trial in Manhattan, will ultimately determine the penalty.

The case centered on a mortgage lending process at Countrywide, which Bank of America bought in July 2008, known as the “high-speed swim lane,” or HSSL, nicknamed the “hustle.”

The defrauding cases were found against mortgage companies Fannie Mae and Freddie Mac in relation to the sale of misused loans in 2007 and 2008 with a reported loss of over $1 billion. The case also mentions that the program from Bank of America had a reward system for employees to focus on the quantity of loans produced rather than the quality, which is suspected to have led to the backup check on each loan’s validity.

Read the full story here. 

 

Reach Executive Producer Eric Parra here.