A group of investors is fighting back against a proposed $8.5 billion settlement Bank of America Corp. reached last week to resolve claims related to soured Countrywide Financial loans.
The 11 investors, using the name Walnut Place, said in a court filing Tuesday that the parties involved in the settlement have "serious conflicts of interest" and that the agreement would "extinguish the legal rights of hundreds of other investors."
The Charlotte bank last week reached a settlement that it said would resolve most of the claims by private investors who want Bank of America to buy back defective Countrywide loans that were turned into mortgage-backed bonds during the housing boom. The agreement, which still needs court approval, is backed by 22 major investors and Bank of New York Mellon, the trustee for the mortgage securitizations.
The settlement is the latest attempt by Bank of America to resolve repurchase requests, lawsuits and regulatory investigations tied to the subprime lender it bought in 2008. With the latest agreement, the bank has said its remaining exposure to buyback requests is about $5 billion.
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