Bank of America settles Countrywide securities case
Lender Bank of America (BAC) and Countrywide, which is now under BofA's umbrella, agreed to settle with a major retirement fund and various investor groups to end a lawsuit over residential-mortgage backed securities. The plaintiffs in the case claim Countrywide, which was sold to BofA in 2008, misrepresented the quality of toxic MBS sold off to investor funds, including several retirement funds.
An amount was not disclosed in court records, but filings show both sides agreed to the settlement.Plaintiffs in the case – which is titled The Government of Guam Retirement Fund v. Countrywide – include the California Public Employees' Retirement System and Blackrock Financial Management Inc. In the original complaint filed back in July, the plaintiffs sued Countrywide and its former CEO Angelo Mozilo as well as other top executives, claiming the lender "blatantly issued materially false statements throughout the period between March 12, 2004 and March 7, 2008 when characterizing their underwriting on loan originations. Those loans were later sold off to investors and investment funds who launched the suit against Countrywide and its parent, BofA, earlier this year. Write to Kerri Panchuk.