Florida eyes subprime settlement from Bank of America
July 1st, 2008 | by admin |MIAMI, July 1 (Reuters) - The U.S. state of Florida hopesto negotiate a settlement with the Bank of America (BAC.N: Quote, Profile, Research, Stock Buzz) forwhat the state called the deceptive lending practices of itsnewly acquired mortgage unit Countrywide Financial Corp., thestate attorney general said on Tuesday.
“There is technically a deep pocket. They’ve acquired them,they assume their liabilities,” Florida Attorney General BillMcCollum told journalists on a conference call.
Bank of America Corp completed its purchase of Countrywideon Tuesday, a day after Florida filed a civil lawsuit accusingCountrywide of deceptive lending practices.
The state alleged that the mortgage lender gave subprimeloans to borrowers who could not repay them, loaned money athigher subprime rates to people who qualified for prime rateloans and engaged in other unfair trade practices.
A Bank of America spokesman could not immediately bereached for comment.
McCollum said he could not estimate how many Floridianswere affected. The lawsuit asks for actual damages to allconsumers who were injured, plus a fine of up $10,000 for eachact that violates the law.
The attorney general believes Countrywide still has a largeportfolio of assets that could be tapped and that he would bein touch with Bank of America’s attorneys to try to negotiate asettlement.
“We aren’t ready yet to give you a dollar figure but itwould have to be a dollar settlement of some sort,” McCollumsaid. (Reporting by Jane Sutton, Editing by Michael Christie)
