FL Attorney General Announces $67 Million National Settlement with Bank of America over Bid-Rigging Scheme

Attorney General Announces $67 Million National Settlement with Bank of America over Bid-Rigging Scheme

~Anticompetitive allegations harmed municipalities, non-profits~

TALLAHASSEE, FL – Attorney General Bill McCollum today announced that Bank of America will pay $67 million under a multistate settlement for its involvement in a nationwide scheme to allegedly rig bids and engage in other anticompetitive conduct relating to municipal bond derivatives that defrauded state agencies, local governmental entities and not-for-profit entities. The multistate settlement is part of a $137 million settlement Bank of America is entering into simultaneously with the Securities and Exchange Commission (SEC), the Office of the Comptroller of the Currency (OCC), the Internal Revenue Service (IRS) and the Federal Reserve.

The investigation focuses on individuals at Bank of America, other major financial institutions, and certain brokers in connection with the marketing and sale of municipal derivative investments, which are typically investment contracts that government issuers and not-for-profit entities use to reinvest the proceeds of tax-exempt bond offerings until the funds are needed or to hedge against interest rate risk. The transactions are often awarded after a competitive bidding process or negotiated directly between the financial institution and the issuer.

Today’s global settlements are the result of an ongoing criminal and civil investigation involving the state Attorneys General, the Department of Justice’s Antitrust Division (DOJ), the SEC, OCC and IRS revealing that from 1998 through 2003, Bank of America and other financial institutions and brokers allegedly rigged bids, improperly assisted in the bidding process and submitted non-competitive “courtesy” bids on these investments. The alleged schemes enriched financial institutions or brokers at the expense of state agencies, local governmental entities, and nonprofit organizations.

Bank of America was the first and only entity in the scheme that voluntarily self-reported the wrong-doing to the DOJ. Under the DOJ’s Corporate Leniency Program, Bank of America was granted conditional leniency based on its acknowledgement of wrongdoing, significant cooperation and making restitution. To date, the DOJ has brought criminal actions against seven individuals and one company and has obtained guilty pleas against eight others involved in the schemes.

The combined settlements will provide restitution to state agencies, local governmental entities, and nonprofit entities both within Florida and throughout the United States who entered into municipal bond derivative investments with Bank of America and were injured by the scheme. Eligible Florida entities will receive a total of approximately $5.2 million under the settlement.

Under the agreement, Bank of America must provide the Attorneys General with written standards of conduct with respect to antitrust and unfair trade practices and provide a copy to employees. Bank of America has represented that it has terminated its illegal conduct, and must also cooperate with the ongoing investigation of the Attorneys General into municipal bond derivatives.

Other states joining Florida in the Bank of America settlement include Alabama, California, Connecticut, Illinois, Kansas, Maryland, Massachusetts, Michigan, Missouri, Montana, Nevada, New Jersey, New York, North Carolina, Ohio, Oregon, Pennsylvania, South Carolina and Texas.

SOURCE: Florida Attorney General



18 Responses to “FL Attorney General Announces $67 Million National Settlement with Bank of America over Bid-Rigging Scheme”
  1. It took you this long??? I sent info as far back as 2008 stupid me was tipping off the bankd? Clearly they were the honest ones!! No one would pay attention!! Fraud reported on all personal residences and 1031inheritance/investments to no avail! Lucky me! Extended stay motel living! Where are the laws that were supose to protect us? Fair housing! Turned down once too often for renting apartment 1/3 of what wss paid for house payment?? Oh forgot!! Dirtbsg homeowner you real estate agents in bef with tje banks

  2. Fury says:

    “standards of conduct?”

    how about cold hard cash for the victims who have been defrauded by the bank monsters????

  3. Fury says:

    there is a tsomething called, “kettling.”
    it is a round up– corralling people in an area in order to try to control them.
    police are using it to silence protesters and limit there access to areas..

    to me, it sounds like the 50 AGs are being “kettled.”

    they are being held in a holding pen until they sign some bogus “settlement” that does zero for the crime victim homeowners,

    i hope that they really are representing the people in their states rather than the corporations and banks who
    gave them campaign donations.

    although, i admit, i really have lost faith in that respect

    this whole fraudclosure debacle is so shocking.
    i have not seen so many liars in my life!

  4. I am so sick of hearing that this bank paid millions in fines to stay out of prison..that bank paid millions for wrong shit they did…the guy on the street found fraud in his mortgage..but that was an error…fraud everywhere…yet no indictments..just given time to fix all the fraud…fraud that cannot be fixed and the court’s are blind to that fact. I do not feel these fines of millions are being paid. Nothing has been done..period. No wonder people are fed up and burning mad….the crime is shoved in our faces..like it or not. So I and probably millions of others don’t care to hear any more bull shit about what bank paid for their crimes with ‘air’ money…we have seen no money… we want answers and indictments….their blood is no better than ours……

  5. Diana says:

    This is one of those cases of good news/bad news! Its indeed GREAT NEWS that our Florida Attorney General has recouped STOLEN funds for Florida’s State and County coffers! I say, “Good job, Attorney General McCollum!”

    The bad news is, WHERE’S THE PLASTIC HANDCUFFS? Fraud is illegal! Grand Theft is lilegal! The RICO Act applies here. The CEO and others from BOA should be prosecuted! The return of funds is great, however, it should not include a deal for a :”GET OUT OF JAIL FREE” card!

    Hopefully, they will continue to go after all the crooked fraudsters and BANKRUPT THE BANKS!! Is it too much to ask to pursue arrest warrants also?

  6. StuckinSoPa says:

    I’m going to guess that BOA’s head a$$hole gets more than that in yearly bonuses. 167 BILLION would have woke them all up. These sloppy wet-kiss sweetheart deals masquerading as justice are making me vomit.

  7. George Frederick& Cecilia Engle says:

    Just a tip of the “BERG”… What about all of us that have been victimized by these BOTTOM FEEDERS”?

    • RAMONA says:

      us?? lol we never get one red cent and we are the victims. we have never even got any of the money that was promised tohelp the home owners the banks just pocketed it. In fact, they have just been given the money back and forth to each other

    • Tiffany says:

      thank you…my thoughts exactly. What about the homeowners? We the people that have been wronged. When are they gonna stick up for us? Oh …I know …hurry up and wait. The government always gets their money….yet so many families are still being pushed around by Bank of America…ughhhhhh

  8. leapfrog says:

    Wow, that sucks that the people of Florida got sold out by their lame duck attorney general. And just WTF is this “Corporate Leniency Program”?

    Is there a “Citizen’s Leniency Program” for fraud? Of course not! Just one more reinforcement that DOJ is in bed with the bankstas.

    If a commoner defrauded anyone they’d be locked in jail with the key thrown away. WHICH IS WHAT SHOULD HAPPEN to the high-level players at Bank of America.

    • RAMONA says:

      it is a wonder that there are any poor or middleclass people living in florida with everything that is going against them

      • Katheryn says:

        They are getting rid of us everywhere! There will be no middle class. Rich, richer, richest vs. poor, poorer , poorest.

    • Katheryn says:

      We need someone like 60 minutes to do a show on these points. Why no convictions? Why is this White Collar Crime OK? There needs to be plenty of media coverage on this aspect also.

  9. Grady says:

    Whoop de do! The criminals, when busted, get a slap on the wrist and they go along their merry way, continuing in their crimes!

  10. isavehouses says:

    Hip hip horay for the attorney generals office and all the participating states. Now the big question is:

    Who gets the cash? Will the state bail out struggling home owners? How come the states have not been after the banks so aggressively for us the American people? Is it because there is no pay off for them?

  11. ny says:

    BOOHOO, how is that helping the people? Where are the indictments McCallum? No wonder you got fired from office…

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