Bank of America is on the verge of finalizing a reported $17 billion settlement with the U.S. government over the packaging and selling of bad mortgages, and it would be the biggest single hit taken by a big bank since the financial crisis.
Since 2009, big banks in the U.S. and Europe have paid at least $128 billion to regulators, according to data compiled by the Wall Street Journal, Reuters, and The Huffington Post.
But don’t feel sorry for these financial giants. In the same time frame since 2009, the U.S. banking industry alone has reaped $503 billion in profits, according to FDIC quarterly data through the first quarter of 2014.
Bank of America’s reported $17 billion settlement would be more than double its approximate $7.5 billion in profit just over the past year, according to a HuffPost.
The question that lingers for consumer advocates is whether the millions of homeowners wronged by mortgages they never should have been saddled with have been properly compensated through the two super deals known as the National Mortgage Settlement and the Independent Foreclosure Review.
Unfortunately, that remains an opened-ended issue that still generates reports of how badly homeowners mired in foreclosure have been treated. An October 2013 civil verdict by a Manhattan federal court jury found Countrywide Financial, now a unit of Bank of America, financially liable for a program named “Hustle”, which allegedly processed thousands of mortgage applications at high speed with little checking for fraud, misrepresentations or other deficiencies.