The Federal Trade Commission (FTC) brought charges against Countrywide Financial for collecting outsized fees from nearly 200,000 borrowers facing foreclosure. The FTC stated Countrywide charged about 200,000 borrowers who were behind on their mortgages fees adding up to hundreds of thousands of dollars. Fees charged included property inspection and landscaping services.
Bank of America purchased this pile of trash company in July 2008. The funds are to be used to reimburse borrowers who were fleeced by Countrywide Financial prior to the sale to Bank of America.
Bank of America said it agreed to the settlement "to avoid the expense and distraction associated with litigating the case," which also resolves litigation by bankruptcy trustees. "The settlement allows us to put all of these matters behind us," the company said.
According to the FTC: Countrywide created subsidiaries to hire vendors, which marked up the price for such services and the company "earned substantial profits by funneling default-related services through subsidiaries that it created solely to generate revenue," the agency said in a news release.
The agency also alleged that Countrywide made false claims to borrowers in bankruptcy about the amount owed or the size of their loans and failed to tell those borrowers about fees or other charges.
One could safely assume that $108 million was a bargain. Angelo Mozilo, the character right out of the Sopranos. Amount of jail time for Angelo...ZIP so far. And your friendly neighborhood Bank of America received how much TARP.....???
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