Bank of America (BAC), Citigroup (C) and Wells Fargo & Co. (WFC) are among U.S. banks that said in Friday regulatory filings they may incur costs defending lawsuits from investors in their mortgage-backed securities.

Bank of America said it is a defendant in cases alleging that documents relating to more than $375 billion in mortgage-backed securities may have contained misrepresentations and omissions, and failed to meet underwriting standards. Wells Fargo and Citigroup said they were defendants in similar lawsuits, and that costs may rise from the resulting litigation.

Some mortgage-backed securities investors have threatened to sue several of the largest U.S. mortgage providers if they don't repurchase debt related to allegedly faulty mortgaged-back securities, in which many mortgages have gone into default.

Financial analysts have said JPMorgan Chase & Co. (JPM), Bank of America and other mortgage sellers may collectively take losses in the $100 billion range if investors force them to buy back debt on faulty mortgages.


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Wayne

Oh what a wicked web we weave. If the banks would have just admitted to the wrong doings of their employees and tried as hard to repair the problems as they did in trying to cover it up it may have gone a little better for them. It will all come out in the wash eventually.

November 07 2010 at 9:57 AM Report abuse rate up rate down Reply
cliffy934

Well, looks like the Banks might need another tax payer bail out.

November 07 2010 at 1:28 AM Report abuse rate up rate down Reply
1 reply to cliffy934's comment
jkennedy806

Hell NO says the republicans - PONY UP Boys, you banksters got greedy, now, the economy is in a real depression, people are out of work, homes in foreclosure, what part of this don't you big banks get? NO MORE SWAPPING MORTGAGES, NO MORE MERS, those who dance must pay the band. Dig deep into the gold lined pockets and welcome to the world of being poor. Wish I could feel sorry for you.

November 07 2010 at 4:05 PM Report abuse rate up rate down Reply