By David Madden

NEWARK, N.J. (CBS) – The feds announced a record settlement of financial fraud charges against Bank of America, stemming from the sale of mortgage backed securities that led to the national economic collapse several years ago.

Assistants in the U.S. Attorney’s office in Newark were looking into mortgage notes issued through Merrill Lynch, a Bank of America subsidiary, that predated the 2008 market collapse.

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“We were poised to file a lawsuit a few weeks ago when we finally were able to close the deal with Bank of America on the amount that the bank would pay,” says U.S. Attorney Paul Fishman.

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It was over $16.5-billion — the largest of three settlements with major national financial firms. $5-billion goes to the government. Some more goes to several states. A total of more than $9.5-billion will go to homeowner relief.

 

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