United States v. Bank of America Corp.

The United States and all 50 states (collectively, United States) sued the Bank of America Corporation and various affiliated entities (collectively, BoA) and other financial institutions (collectively, defendants) with violating the federal False Claims Act, the Financial Institutions Reform, Recovery and Enforcement Act of 1989, the Servicemembers Civil Relief Act, the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure, and state unfair-and-deceptive-acts-and-practices laws. The United States alleged that BoA’s mortgage-servicing practices violated federal and state law. The United States and BoA agreed to a consent judgment, which the court ordered, adjudged, and decreed. The consent judgment required BoA to comply with specified mortgage-servicing standards and to pay more than $2.3 billion into a fund to be distributed in the manner and for the purposes set forth in the consent judgment. The consent judgment further required that the escrow agent, who was to be appointed pursuant to the judgment, transfer approximately $1.5 billion from an escrow account to the settlement’s administrator, who was to distribute these funds to certain mortgage borrowers whose homes were finally sold or taken by foreclosure between January 1, 2008, and December 31, 2011. Finally, the consent judgment required BoA to provide more than $7.6 billion in relief to eligible consumers and to pay approximately $950 million in refinancing relief to eligible consumers.