U.S. attorneys general offices in Georgia and California are examining potential violations tied to Countrywide Financial Corp., the subprime lender Bank of America bought in 2008, said the people, who asked not to be identified because the inquiries arenít public. U.S. attorneys in New Jersey are looking into deals involving Merrill Lynch & Co., purchased by the firm in 2009, the people said.
If claims are brought, Bank of America would join JPMorgan Chase & Co. in dealing with government demands that it resolve liabilities inherited after buying weakened rivals at the governmentís urging during the credit crisis. JPMorgan, the biggest U.S. bank, reached a tentative $13 billion agreement last week to end civil claims over mortgage-bond sales.
Bank of America is being scrutinized for violations of the Financial Institution Reform, Recovery and Enforcement Act of 1989, or FIRREA, an outgrowth of the savings-and-loan crisis, according to the people. The Justice Department cited that statute in its August lawsuit against the firm, which is the nationís second-largest lender after JPMorgan.
The law allows the government to sue an individual or group for fraud that affects a federally insured financial institution. It carries a 10-year statute of limitations.
Bill Halldin, a spokesman for Bank of America, declined to comment on the pending inquiries.
The lender wrote in an Aug. 1 regulatory filing that itís cooperating with state and federal probes into how home loans were bought, bundled and then sold to investors.