A magistrate judge has recommended dismissal of a U.S. Department of Justice lawsuit accusing Bank of America of defrauding customers on prime mortgages, according to a court document filed Thursday.
The department filed the suit in August, claiming the Charlotte bank misled investors on the risks involved with loans backing securities that ultimately soured. Bank of America had marketed the loans as prime loans, but the government alleged that the bank didnt follow its own underwriting standards, meaning the loans ended up to be much riskier.
The magistrate judge ruled Thursday that the laws the government sued under did not properly apply, according to the court filing. He recommended the claims be dismissed.
The Department of Justice filed an objection to the judges decision Thursday. The court must still rule on whether to accept the magistrate judges decision. That ruling can then be appealed.
Dunn: 704-358-5235; Twitter: @andrew_dunn
The Charlotte Observer welcomes your comments on news of the day. The more voices engaged in conversation, the better for us all, but do keep it civil. Please refrain from profanity, obscenity, spam, name-calling or attacking others for their views.
Have a news tip? You can send it to a local news editor; email firstname.lastname@example.org to send us your tip - or - consider joining the Public Insight Network and become a source for The Charlotte Observer.Read moreRead less