Nevada Expands Bank of America Lawsuit

ProPublica is reporting that the state of Nevada significantly increased the scope of its lawsuit against Bank of America today.

Nevada’s attorney general charges that Bank of America and the now-defunct mortgage giant Countrywide acquired by the bank in 2008, deceived borrowers and investors at almost every stage of the process.

According to the suit, borrowers were duped into unaffordable loans and then victimized again through a misleading mortgage modification program that homeowners tried to use to avoid foreclosure. Finally, the bank filed fraudulent documents to move forward with the foreclosures.

“Taken together and separately, [Bank of America’s] deceptive practices have resulted in an explosion of delinquencies and unauthorized and unnecessary foreclosures in the state of Nevada,” the suit alleges.

This new step may further weaken efforts of the “coalition” of 50 state Attorneys General to reach a settlement with five of the largest banks.  Disagreement among the states reached a new height last week when Iowa Attorney General Tom Miller, who heads the coalition, removed New York AG Eric Schneiderman from the coalition’s executive committee due to his consistent opposition to a quick settlement.