Bank of America announced on Thursday that it has agreed to a $16.65 billion settlement with the federal government to resolve allegations that it sold faulty mortgage-backed securities to investors in the run-up to the financial crisis in 2008. Specifically, the bank will pay about $7 billion in relief to homeowners and about $9.65 billion in cash penalties, including a $5.02 billion civil monetary penalty and $4.63 billion in compensatory remediation payments.

Brian Moynihan, CEO of Bank of America, has said in recent interviews that once the bank gets this large settlement finalized, it will be among the last that the bank faces in connection with the faulty mortgages sold to investors - most of which were originated by Countrywide Financial Corp., which Bank of America purchased in the wake of the 2008 financial crisis.

 

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