Bank of America has sold out its customers who had invested in failed mortgage securities during the 2008 financial crisis, Press TV reports.
Å“It was a shameless sellout of people who were literally robbed blind in the home mortgage crisis of the post Glass-Steagall repeal period,” said Jeff Steinberg, a US economic analyst.
This is while Bank of America headed to court on Monday to push for an $8.5 billion settlement with investors in mortgage securities that went bad during the financial crisis.
Opponents criticized the move, saying the settlement represented only pennies on the dollar for the billions that were lost in the wake of the 2008 financial crisis.
Several state attorneys general said that losses to the trusts might exceed $100 billion, and that the banking giant is liable to its customers.
Å“New York State Attorney General [Eric] Schneiderman and a number of other state attorneys general who are going back in to prosecute, to re-sue these banks over the fact that they failed to even live up to the demands of that deal that was a sweetheart deal to begin with,” said Steinberg.
A bank settlement would leave investors without the option of a trial as well as strike the ability to hold the bank responsible for misrepresentations on the quality of the underlying mortgages.
Following the housing crisis in 2008, a massive investigation revealed that many US banks were responsible for pushing unaffordable mortgages, issuing higher rates to minorities who were qualified for a better rate, having employees Ëœrobo-signâ„¢ foreclosure documents, and other offenses.
In 2012, the Justice Department found that banking giant Bank of America had illegally requested information from potential customers who had requested loans.
The Federal Reserve found in 2011 that Wells Fargo is accountable for steering up to 10,000 customers into subprime loans even though they qualified for better rates. The bank has so far failed to compensate the victims.
GMA/PR
This article originally appeared on: Press TV