Reuters is reporting that Bank of
America (BOA) is the subject of yet another investigation. New York State Attorney General Eric
Schneiderman is allegedly looking at the bank's purchase, securitization, and
underwriting of home mortgages. BOA would
be the third bank targeted by Schneiderman's office over securitization
practices.
Reuters took its information from a 10-k
securities filing by the bank in which it said it was cooperating with the
investigation. In the filing with the
Securities and Exchange Commission BOA said it could sustain up to $3.1 billion
in legal losses beyond the amount for which it has reserved. That was up from a
possible loss above legal reserves of $2.8 billion at the end of the third
quarter.
According to Reuters the attorney general's office has another case pending
against the bank, a lawsuit filed by then-New York Attorney General Andrew
Cuomo in 2010 against the bank and its former chief executive Ken Lewis over
the acquisition of Merrill Lynch during the financial crisis.
BOA has settled dozens of suits, both on its own and in combination with
other banks and bank-owned subsidiaries, arising out of its lending practices
in the several years before the housing crash, its purchase of Countrywide Mortgage,
and activities of its servicing subsidiary.
Neither Schneiderman's office nor BOA have commented on the Reuter's report.