NEW YORK (Reuters) - Staff of a U.S. Attorney’s office recently told Bank of America Corp that they plan to recommend the U.S. Department of Justice file a civil action against the bank related to securitization of mortgages, according to a regulatory filing on Wednesday.
That investigation is one of several the second-largest U.S. bank is trying to resolve over mortgage practices of its own legacy business, as well as those of Countrywide and Merrill Lynch, which it acquired during the 2007-2009 financial crisis.
The bank did not name which U.S. attorney was planning to make the recommendation.
Bank of America also lifted its estimate for possible losses above what it has already set aside to cover litigation expenses, according to its 10-Q filing with the U.S. Securities and Exchange Commission.
Bank of America now estimates its litigation losses may exceed reserves by up to $5.1 billion, up from a prior estimate of $2.8 billion.
(Corrects to show a U.S. attorney’s office, not the U.S. attorney’s office)
Reporting by Lauren Tara LaCapra, Peter Rudegeair and David Henry; Editing by Bernard Orr