AP source: Bank of America nears $16B to $17B settlement
Bank of America is nearing a $16 billion to $17 billion settlement to resolve an investigation into its role in the sale of mortgage-backed securities before the 2008 financial crisis, a person directly familiar with the matter said Wednesday.
The deal with the bank, which still must be finalized, would be the largest Justice Department settlement by far arising from the economic meltdown in which millions of Americans lost their homes to foreclosure. It would follow earlier multibillion-dollar agreements reached in the past year with Citigroup and JPMorgan Chase & Co.
The person, who spoke on condition of anonymity because the deal had not yet been announced, cautioned that some details still needed to be worked out and that it was possible the agreement could fall apart.
But the person said the two sides reached an agreement in principle after a conversation last week between Attorney General Eric Holder and Bank of America CEO Brian Moynihan.
The person said the tentative deal calls for the bank to pay roughly $9 billion in cash and for the remaining sum to go toward consumer relief.