June 11 Bank of America Corp and the
U.S. Department of Justice (DOJ) have reached an impasse in
negotiating a multibillion-dollar settlement deal related to the
bank's mortgage investments, the New York Times reported, citing
people briefed on the matter.
The talks stalled on Monday after the bank's latest offer of
more than $12 billion to resolve state and federal
investigations into its sale of mortgage investments fell far
short of prosecutors' demands, the newspaper said.
On Tuesday, as Bank of America sought to continue
negotiations, the Justice Department moved to put the finishing
touches on a civil complaint against the bank, the report said,
citing the people. (r.reuters.com/nuk99v)
The lawsuit, which is not imminent, is expected to accuse
the bank of selling mortgage investments that led to billions of
dollars in losses.
Reuters reported in April that Bank of America said in an
annual regulatory filing that a U.S. Attorney's office advised
the bank it would recommend the Justice Department bring a civil
case against its affiliates over mortgage bonds.
The second-largest U.S. bank faces multiple government
probes over the underwriting, sale and securitization of
residential mortgage bonds before the financial crisis.
Representatives for Bank of America and the DoJ did not
immediately respond to emails seeking comment outside regular
U.S. business hours.
(Reporting by Supriya Kurane in Bangalore; Editing by Gopakumar