By Max Stendahl (October 24, 2012, 1:21 PM EDT) -- The U.S. Department of Justice on Wednesday hit Bank of America Corp. with a $1 billion False Claims Act suit alleging the bank sold defective mortgage loans to Fannie Mae and Freddie Mac through a fraudulent origination program called "the Hustle."
The government filed suit based on information provided by Edward J. O'Donnell, a whistleblower and former senior vice president of bank subsidiary Countrywide Financial Corp. The suit is the first by the government concerning mortgage loans that were sold to Fannie and Freddie and packaged into securities, according to U.S. Attorney for the Southern District of New York Preet Bharara, who filed the complaint....
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