Daily Archives: October 20, 2010

Bank of America is Sued by New York Fed and Other Banks

On Monday eight banks and he Federal Reserve Bank of New York announced the are suing Bank of America for an undisclosed amount money. These financial institutions are suing because BofA through it newly acquired Countrywide Loans. From:CNBC

The New York Federal Reserve Bank is part of a consortium of eight large institutional investment firms that is demanding thaBank of America repurchase loans included in mortgage securities.

Bloomberg reported earlier Tuesday that the New York Fed had joined with the Pacific Investment Management Company, better known as Pimco, and investment management firm BlackRock in an attempt to force BofA to buy back $47 billion in mortgage bonds.Kathy Patrick, lead attorney for the consortium, confirmed in a statement Tuesday that the group holds more than 25 percent of the voting rights in more than $47 billion worth of Bank of America securities.

Pimco and BlackRock had no comment when contacted by CNBC.

Shares of Bank of America [BAC  11.80  -0.54  (-4.38%)   ], a component of the Dow Jones Industrial Average [.DJIA  10978.62  -165.07  (-1.48%)   ], were more than 4 percent lower Tuesday.

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