Whistleblower wins court case against Bank of America

Bank of America, one of the nation's largest financial institutions, has recently come under fire from U.S. housing agencies and private investors over toxic mortgages the bank's Countrywide Financial branch sold them at the onset of the housing crisis.

The problems for the bank continue, as U.S. authorities recently ordered Bank of America to pay $930,000 to an employee who was terminated after she exposed the fraudulent practices of the mortgage unit, Countrywide Financial, AFP reported.

Bank of America has since sold off Countrywide Financial, but continues to pay for its shoddy practices. In a statement, the U.S. Labor Department said the employee led an internal investigation into the mortgage branch that found wire, mail and bank fraud, and then was illegally fired.

"It's clear from our investigation that Bank of America used illegal retaliatory tactics against this employee," said David Michaels, a senior Labor Department official.

In an interview with the news source, a spokeswoman for Bank of America said the employee was fired based on her management style and not due to her investigation. The Bank will appeal the decision made by the Labor Department.

Eileen Foster, vice president of Countrywide and Bank of America after the acquisition in 2008, said Countrywide's management helped sales team members who inflated borrowers' incomes on loan applications and falsified paperwork when evaluating and offering mortgage-backed securities to investors, The Center for Public Integrity reported.

"The organization built its business to take advantage of the fraud," Foster said. "It benefited from the fraud and it protected the fraud." 

More News