BofA $16.5B settlement to help Illinois pensions and struggling homeowners
The biggest settlement in the mortgage securities fraud will help the Illinois pension funds and some homeowners struggling to pay their mortgages.
Bank of America agreed to pay more than $16-and-a-half billion for its role in the bad loans scandal that devastated the economy in 2007-2008. Illinois will receive $300 million.
$200 million will go to the state’s pension system. Illinois Attorney General Lisa Madigan said the payment fully returns the losses that occurred during the economic crisis.
Illinois homeowners will receive another $100 million.
“You’ve seen the homes that have been foreclosed on, the communities that were vibrant that are now boarded up,” said Madigan, “so there is a lot of work to be done to continue to hold banks accountable … to make sure it doesn’t happen again.”
Madigan said this is the fourth time her office helped settle a large claim against Bank of America.
The previous record settlement was set last year when JP Morgan Chase agreed to pay $13 billion.