June 19 A North Carolina judge ruled on Thursday
that a Justice Department lawsuit against Bank of America Corp
could move forward, allowing the complainant 30 days to
file its amended petition.
The Department of Justice's lawsuit accuses Bank of America
of civil fraud in the sale of mortgage securities that soured
during the global financial crisis.
"The court need not reach far outside the complaint or be an
expert in economics to take notice that it was the trading of
toxic RMBS between financial institutions that nearly brought
down the banking system in 2008," Cogburn wrote in an order.
At a hearing last week in Asheville, North Carolina, U.S.
District Judge Max Cogburn said he would consider dismissing the
lawsuit, saying the DoJ may not have the evidence to try this as
a fraud case.
Cogburn had at that time also said he would consider
allowing the DoJ to amend its complaint.
Representatives at the DoJ and a Bank of America spokesman
did not immediately respond to emails seeking comment outside
regular U.S. business hours.
Cogburn also ruled that a related lawsuit - by the U.S.
Securities and Exchange Commission brought against Bank of
America, can move forward.
(Reporting by Supriya Kurane in Bangalore; Editing by Gopakumar