From Bloomberg:
Bank of America Corp., the largest U.S. lender, “significantly hindered” a federal review of its foreclosures on loans insured by the Federal Housing Administration….
“Our review was significantly hindered by Bank of America’s reluctance to allow us to interview employees or provide data and information in a timely manner,” William Nixon, an assistant regional inspector general for the agency, said in a sworn declaration.
The declaration, dated June 1 and obtained today by Bloomberg News, was filed as an exhibit in a lawsuit by the state of Arizona against the Charlotte, North Carolina-based bank. Arizona, which is seeking to interview former Bank of America employees, accuses the bank of misleading homeowners who were seeking mortgage modifications….
The HUD inspector general’s office conducted reviews of the five largest servicers “as they relate to FHA loans that have been foreclosed upon” and for which the servicers claimed insurance benefits, according to Nixon’s declaration. The office sought to determine whether Bank of America complied with applicable procedures when conducting foreclosures on FHA- insured loans…
The HUD inspector general’s report on Bank of America, which hasn’t been made public, was prepared “in light of possible future litigation,” according to Nixon’s declaration. Nixon, who works in Fort Worth, Texas, couldn’t be reached for comment.
Bank of America submitted 40,219 FHA claims totaling $5.7 billion from Oct. 1, 2008, through Sept. 30, 2010, according to the declaration. About 86 percent of its claims were for loans previously serviced by Countrywide Financial Corp., which Bank of America acquired in 2008.
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