Bank of America accused of preventing federal investigation

Bank of America accused of preventing federal investigation

Bank of America is accused of hindering the US regulators to review foreclosure practices of the company, says the court filing.

The mortgage practices of BofA have been investigated by federal regulators and state attorneys general including the use of "robo-signers" to sign hundreds of unread foreclosure documents a day.

The Department of Housing and Urban Development inspector general's office conducted a review of the five largest mortgage servicers, including Bank of America, which is the biggest.

BofA "significantly hindered" the review said Departmental auditor William Nixon in a document filed in a lawsuit brought by the State of Arizona against the bank.

BofA was slow to provide documents and other information, Nixon said in a sworn declaration dated June 1.

"When interviews were permitted, the presence or involvement of the bank's attorneys limited the effectiveness of those interviews," Nixon said in the filing.

In the course of the inspector general's review it was found that banks did not have proper paperwork in place when filing to have the Federal Housing Administration reimburse them for federally insured loans on foreclosed properties that were sold for less than the remaining balance for the mortgages, according to a person familiar with settlement talks between the banks and regulators.