Bank of America's Epic $20 Billion Face-Plant

Photo: Flickr/Herve Boinay.

It's safe to say that Bank of America (NYSE: BAC  ) is ready to put 2013 in the rearview mirror. By my estimate, over the past 12 months, the nation's second largest bank by assets has incurred just under $20 billion in legal fines and settlements -- and that's excluding the hundreds of millions, if not billions, of dollars it paid to attorneys.

The list of alleged misdeeds -- none of which Bank of America formally copped to, of course -- includes discriminating against women and minorities, illegally robo-calling customers' cell phones without consent, hiding material information from its own shareholders about its 2008 purchase of Merrill Lynch, and misleading third-party investors into buying faulty mortgage-backed securities. And this is just to name a few.

The list is so numerous that it's hard for even experts to keep track of the bank's mounting legal tab. It's for this reason, in turn, that I compiled the following table of Bank of America's most notable settlements (and related legal resolutions) for the year that's coming to a close. As an investor in the bank myself, here's to hoping that 2014 will be better!

Approximate Settlement Date

Description

Cost

Jan. 7

Settlement with Fannie Mae resolving claims that B of A sold tens of billions of dollars' worth of faulty mortgages to the government-sponsored entity.

$10.3 billion

Jan. 7

On the same day as the Fannie Mae settlement, B of A joined with nine other lenders to resolve claims of foreclosure abuse related to the financial crisis. The aggregate settlement for all participants was $8.5 billion.

$2.9 billion

Feb. 1

Settlement to resolve a class action lawsuit alleging that B of A violated the Real Estate Settlement Procedures Act by failing to respond to mortgagees' requests for information relating to the servicing of their home loans.

$19 million

Feb. 15

Settlement to resolve allegations that Merrill Lynch failed to pay proper overtime to its client associates.

$12 million

April 2

Settlement with the National Credit Union Administration to resolve claims related to sales of mortgage-backed securities to corporate credit unions that led them to fail.

$165 million

April 5

Settlement to resolve claims that B of A misled investors about its 2008 acquisition of Merrill Lynch by failing to disclose billions of dollars in pre-approved bonuses to Merrill's executives and employees.

$2.4 billion

April 17

Settlement with investors in class action lawsuit involving Countrywide-issued mortgage-backed securities.

$500 million

May 6

Settlement to resolve claims brought by mortgage-bond insurer MBIA related primarily to toxic mortgages originated by Countrywide Financial.

$1.7 billion

June 4

Fined by the Financial Industry Regulatory Authority after an investigation found that B of A's brokers steered retail investors toward a type of mutual fund that was riskier than what they were seeking.

$2 million

June 14

Settlement to resolve claims that Countrywide Financial "deceptively lured consumers into buying loans with higher interest rates than originally promised."

$100 million

Aug. 28

Settlement to resolve a class action racial discrimination lawsuit alleging that Merrill Lynch segregated its workforce by, among other things, steering black brokers into clerical positions and reassigning their accounts to white workers.

$160 million

Sept. 6

Settlement to resolve a class action gender discrimination lawsuit brought by female brokers alleging they were "paid less than men and deprived of handling their fair share of lucrative accounts."

$39 million

Sept. 23

Fined by U.S. Department of Labor for hiring practices that kept qualified black job applicants from getting jobs.

$2.2 million

Sept. 30

Settlement to resolve claims that B of A employees made harassing debt collection calls to customers' cell phones in violation of the 1991 Telephone Consumer Protection Act.

$32 million

Oct. 23

Found liable for fraud over defective mortgages sold to Fannie Mae and Freddie Mac as a part of a shoddy home loan process at Countrywide known as the "Hustle."

$850 million*

Dec. 2

Settlement with Freddie Mac related to faulty mortgages sold to the government-sponsored entity from 2000 to 2009.

$404 million

Dec. 12

Settlement with the Securities and Exchange Commission related to the structuring and sale of complex mortgage securities to institutional investors in 2006 and 2007.

$132 million

*This is the amount sought by the government; the judge has yet to rule on the damages. Sources: Bloomberg, Reuters, The New York Times, The Wall Street Journal, and The Huffington Post.

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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 15, 2013, at 4:22 PM, funfundvierzig wrote:

    For a decade, Bilk of America has been in a heated race with J. P. Morgan to be the most fraud-infested financial institution in North America. It appears Bilk of America may be taking the GOLD!

    ...funfun..

  • Report this Comment On December 16, 2013, at 1:23 AM, jolaz69 wrote:

    $20 billion was not enough for these fraudsters. They should have been fined more.

  • Report this Comment On December 16, 2013, at 2:50 PM, pukaman2000 wrote:

    Bank of America I hope that you comfort from the heat of hell is being water-boarded.

  • Report this Comment On December 16, 2013, at 6:35 PM, okjerryds wrote:

    Who is going to pay those that actually lost????

    The government is who is profiting from the loss..

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