Bank of America loses fraud trial over U.S. mortgages

Reuters

NEW YORK, Oct 23 (Reuters) - Bank of America Corp was found liable for fraud on Wednesday on claims related todefective mortgages sold by its Countrywide unit, a major winfor the U.S. government in one of the few big trials stemmingfrom the financial crisis.

Following a four-week trial, a federal jury in Manhattanfound the Charlotte, North Carolina bank liable on one civilfraud charge in connection with shoddy home loans that theformer Countrywide Financial Corp sold to Fannie Mae and Freddie Mac and originated in a process called"Hustle."

The four men and six women on the jury also found a one-timeCountrywide executive, Rebecca Mairone, liable on the one fraudcharge facing her.

A decision on how much to penalize the bank would be left toU.S. District Judge Jed Rakoff. The U.S. Department of Justicehas said it would ask Rakoff to award up to $848.2 million, thegross loss it said Fannie and Freddie suffered on the loans.

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