* "Bank of America", sued by the government for defrauding investors
* "JPMorgan" and "Goldman Sachs", charged with manipulating the price aluminum in the US
The US government has filed a lawsuit against "Bank of America" Corp., the second largest American bank in terms of assets, accusing it of having defrauded investors in a deal worth 850 million dollars with mortgage backed securities.
The US Justice Department and the regulator of the US securities market (SEC) have filed separate civil lawsuits with the Federal Court of North Carolina. The government claims that the bank has misled investors, underestimating the risk of the securities it sold them in 2008.
Officials of "Bank of America" are saying that the value of the shares in question fell heavily after the collapse of the real estate market in the US, which can not be blamed on the bank.
"Bank of America" said it would dispute the charges, stating that "These were prime mortgages sold to sophisticated investors who had ample access to the underlying data, and we will demonstrate that".
According to the Justice Department, the number of loans that defaulted after the deal of 2008 is "abnormally big" and cannot be justified only through the collapse of the real estate market. Furthermore, the American government claims that over 40% of the 1,191 securitized mortgage loans did not meet the internal standards of "Bank of America".
According to the charges being brought against the bank, it put heavy pressure on its employees to approve as many loans as possible, disregarding risk. The Justice Department also claims that the bank concealed the important risks associated with the mortgages underlying the securities. For example, the bank concealed the fact that 22% of the borrowers were self-employed, and 70% of them did not have their revenues validated by the bank. @N_P
