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January 8, 2013

Bank of America to Pay $11 Billion Settlement to Freddie Mac 
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The financial giant Bank of America has agreed to pay more than $11
billion to the government-backed mortgage finance company Fannie Mae for
flooding it with toxic mortgages during the financial crisis. The
Justice Department says Bank of America executed a scheme that would
blindly hand out mortgages without proper checks and then turn around
and sell the toxic loans to Fannie Mae and Freddie Mac. While Bank of
America reaped a windfall, Fannie and Freddie were stuck with huge
losses and foreclosed properties.

 

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