GRIN: "Bank of America is now totally skewered"

[dixiegrrrrl]

Some may remember I have said I had a feeling BAC was in big trouble.

Good article on Zero Hedge tells why. A mortgage fraud settlement agreement with BAC has been challenged by
New York Attorney General Eric Schneiderman. That old mortgage fraud by CountryWide has come back to bite BAC
AND Bank of NY Mellon in the hind end.

Here is excerpt/summary, which is found halfway down the article by Durden:

"Long story short: Bank of America is now totally skewered (as in can you spell U-N-D-E-R-R-E-S-E-R-V-E-D), as this process throws the entire existing settlement, which most certainly was cobbled together with the assistance of the purported legal adversaries so that the American financial system was not scuttled when BAC has to file for bankruptcy, out of the window.
Now that a politically upstart AG is in the pic, and now that he has raised some serious rucus, we expect, as noted above, that the final settlement ask will increase by about $15-20 billion, and in the process sent the company's CDS soaring as the fear of counterparty risk suddenly rears its ugly head in a self-fulfilling prophecy along the same lines as took down Lehman Brothers.
Prepare for a Bank of America public offering. And for our Paulson & Co. LP readers: pray that the billionaire sold his remaining shares in this toxic dump of a bank on which he once upon a time had a $30 price target."

Fun reading, here:
http://www.zerohedge.com/news/got-bank-america-cds-new-york-ag-says-bacs-85-billion-settlement-unfair-and-misleading-bac-equi
"

[Ruby the Liberal]

1. After the markets closed, Beau Biden announced he was joining New York's AG

in attaching the state of Delaware to this settlement suit, which if approved by the court, makes them a party to the suit and gives them access to all witnesses, all evidence.

[dixiegrrrrl]

2. Double grin.

:hi:

[annabanana]

3. I KNEW Eric Schneiderman.was going to be fun to watch. . . . . n/t

[grasswire]

4. if they go belly up will my $250 in overdraft fines go away?

I have refused for a year to pay those onerous fines, and they closed my account causing a strike on my credit report. Bank of America had to pay millions in settlements for that predatory practice. I refuse to pay them.

[Eddie Haskell]

5. The US should step in to protect BOA.

IMHO

[Po_d Mainiac]

6. Why?

[Eddie Haskell]

7. We don't need another failure and BOA did us a favor in 2008.

By buying Countrywide, BOA kept the regulators from the messy task of figuring out who would take on the responsibility of collecting payments for the 9 million U.S. home loans serviced by the failing lender. There was no government support for Countrywide’s loan portfolio. In this case, I'd cut BOA some slack.

[libguy_6731]

8. good point

[Po_d Mainiac]

11. We don't need another TBTF

lying about their assets, submitting fraudulent mortgage related documents to the courts and dumping their turds onto the GSA's.

[truedelphi]

9. Well the Attorney General for the State of Washington would not agree with you.

Why should major fraudsters get a free pass?

Just because they own a bank?

Read this link:

http://news.firedoglake.com/2011/08/05/bank-of-america-death-watch-update-lawsuit-in-washington-elevated-gse-claims/

And I guess some people just don't care if we live in an ethical world or not.

But if so, ya gotta wonder why it is okay tpo rob folks with a gun, but not with a fountain pen (In this case, computerized robo si9gners.)

[truedelphi]

10. K & R. n/t

[pwb]

12. My mortgage was with Countrywide, but when i made the last payment I had to send a certified check

To Bank of America. They are bigger than we all think.

[dixiegrrrrl]

13. that makes sense, BOA bought out Countrywide mortgages, Countrywide went bust.

Now BOA is fighting like hell to pretend they are not responsible for the mortgages they bought out,
( except for the ones that are still paying, of course)
but they have
the State's AGs AND the mortgage bond trustees suing them for proof of the mortgages.
Stuck in the middle, yes indeed.

BTW..our mortgage was with Countrywide, so it got bought by BOA also, we unfortunately are no where near ready to pay off the damn thing.

[truedelphi]

15. These buyout firms were quite happy to get huge tax benefits,

Right?

I mean, when Wells Fargo bought Wachovia, between the tax reffunds for buying the Wachovia losses, and other offsets, the American tax payer was payng Wells Fargo to do it.

[truedelphi]

14. So maybe you will really enjoy this one:

Delaware AG Biden Joins New York State Attorney General Schneiderman, Intervening in Proposed BofA Settlement

For full article:
http://firedoglake.com/2011/08/08/delaware-ag-biden-joins-schneiderman-intervening-in-proposed-bofa-settlement/#comments
<snip to later paragraphs>

Already, the Schneiderman decision is reverberating. Fannie Mae and Freddie Mac plan to hit Bank of America with more mortgage repurchases, raising more liability for them. And today, in the ultimate “I hope for mutual destruction” lawsuit, AIG sued BofA over representations and warrants on their mortgage bonds. They are seeking $10 billion on $28 billion in bonds. This is the largest number sought by a single investor, and it’s a direct piggy-back on what will come out in the settlement, should New York and Delaware be allowed to intervene. This brings the number in mortgage bond lawsuits up to $197 billion.

BofA, meanwhile, has seen its stock sink to a 52-week low, down 26% in a month. More important, from Shahien:The cost to protect Bank of America’s bonds against default have surged more than 17 percent since last Friday, according to Markit.

It now costs $207,000 to protect $10 million of BofA’s debt, as of Friday’s close. Last week, it cost just $176,000. The price of credit protection generally increases as investor confidence deteriorates.

The death watch continues.

[dixiegrrrrl]

16. Well, good news is BOA has a lot less debt to insure, having lost 10 billion today.

Which is just the amount that AIG is suing them for.
and tomorrow is a whole new day!!!