U.S. Files Millionaire Lawsuit Against Bank Institutions

Yesterday, the Federal Housing Agency (FHFA) filed a multimillion lawsuit that accuses Bank of America, JPMorgan Chase, Deutsche Bank, HSBC, Barclays, Citigroup, Nomura and other large financial groups of the loss of 41,000 million dollars to the two public lenders Freddie Mac and Fannie Mae after selling dubious quality mortgages by the value of 179,000 million dollars.

There are 17 states sued for negligence. The case of JP Morgan Chase is the most controversial as it is accused of selling loans worth 33,000 million dollars. Bank of America and its subsidiary Merrill Lynch,30,850 million is second. The lawsuit also quoted Deutsche Bank (14,200 billion), HSBC (6,200 million), Barclays (4,900 million), Citigroup (3,500 million) and Nomura (2,000 million) with Goldman Sachs.

The action of the Obama administration begins within two weeks after the third anniversary of the collapse of Lehman Brothers.

The securitization of mortgages is at the heart of financial collapse. FHFA believes that the banks failed in its obligation to verify the quality of the assets put on the market and failed to see that mortgage holders were making false or exaggerated evidence their income to obtain loans. That made the mortgage-linked debts lose its value more quickly when they fell behind on payments. Washington seeks a refund for the taxpayer to limit losses to the depreciation of those assets.