BofA Says $25B Deal Trumps Mortgage Insurance Qui Tam Suit

Law360, New York (January 6, 2014, 2:21 PM EST) -- Bank of America Corp. asked a California federal judge Friday to dismiss a whistleblower suit alleging it fraudulently obtained federal mortgage insurance by submitting loans based on inflated home appraisals, saying that a $25 billion 2012 settlement with the federal government freed the bank of liability.

In a motion to dismiss filed in federal district court in Los Angeles, Bank of America said whistleblower Brian Hastings has shown a "stubborn refusal" to acknowledge that the February 2012 National Mortgage Settlement covered any potential False Claims Act-based litigation related to Federal Housing Administration-provided insurance.

The bank paid an extra $1 billion to...

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