BofA $1.3 Billion ‘Hustle’ Judgment Tossed by Appeals Court
- Panel rules prosecutors failed to prove fraud at trial
- Countrywide sold loans in 2007 to Fannie Mae to boost revenue
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Bank of America Corp.’s decision to fight government allegations that it defrauded Fannie Mae and Freddie Mac paid off as a federal appeals court threw out a judgment of almost $1.3 billion against the bank.
BofA’s Countrywide Financial unit was the first bank to be found at fault at trial by a federal jury for selling defective mortgage loans under a decades-old statute enacted during the savings-and-loans crisis. The civil fraud suit was one of several brought against banks by Manhattan U.S. Attorney Preet Bharara using the law.