According to an article published today in the Wall Street Journal:
"The government started its "Hustle" case against Bank of America Corp.arguing the bank's Countrywide unit misled executives at Fannie Mae and Freddie Mac about the quality of loans they bought in 2007 and 2008.
The program—called the "Hustle" by Countrywide after the acronym HSSL, which stood for "high-speed swim lane" misled executives at mortgage-finance companies Fannie and Freddie about the quality of loans that Countrywide sold them, the government's lawyers argued Tuesday at U.S. District Court in Manhattan.
In his opening argument before the court, Pierre Armand from the U.S. attorney's office in Manhattan said the promise of quality loans at the Hustle program was "largely a joke," arguing that the program ignored red flags and removed controls that were in place to protect against making bad loans. The government alleges Countrywide made $165 million from the program.
"The government started its "Hustle" case against Bank of America Corp.arguing the bank's Countrywide unit misled executives at Fannie Mae and Freddie Mac about the quality of loans they bought in 2007 and 2008.
The program—called the "Hustle" by Countrywide after the acronym HSSL, which stood for "high-speed swim lane" misled executives at mortgage-finance companies Fannie and Freddie about the quality of loans that Countrywide sold them, the government's lawyers argued Tuesday at U.S. District Court in Manhattan.
In his opening argument before the court, Pierre Armand from the U.S. attorney's office in Manhattan said the promise of quality loans at the Hustle program was "largely a joke," arguing that the program ignored red flags and removed controls that were in place to protect against making bad loans. The government alleges Countrywide made $165 million from the program.
Brendan Sullivan, a partner at the law firm Williams & Connolly LLP, opened his arguments on behalf of Bank of America by stating that no fraud was committed. Mr. Sullivan said the evidence will show "decent, normal people, putting their kids out to school, going to their mortgage application business where there are thousands of mortgages."
The case has pulled back the curtain on how Countrywide, the nation's largest mortgage lender until its sale to Bank of America in 2008, struggled to deal with declining lending volumes amid industry concerns over loan quality as the housing boom turned to bust. The Hustle program didn't continue after Bank of America bought Countrywide".
