Bank of America Corp (NYSE:BAC) seeks RICO lawsuit dismissal
Bank of America Corp (NYSE:BAC) is now seeking the dismissal of the Federal lawsuit that had accused it of initiating a scheme that involved home-mortgage modifications.
This week, the bank submitted the reply to this lawsuit that has been filed in Colorado in July. That is where Urban lending Solution, the co-defendant has operations. The suit has accused the bank and Urban Lending Solution of participating in a racketeering-operation. This operation wrongfully denied the borrowers who seek modifications under the Federal HAMP.
As per the suit, both the defendants had violated the Federal RICO or Racketeer Influenced and Corrupt Organizations Act. They operated an “association in fact” enterprise that was designed to mislead and deceive borrowers via the use of wires and U.S mail. Urban lending Solution is a contractor who received HAMP work from the bank. The lawsuit said in effect, they acted as the Kingpin of the enterprise.
The RICO had been passed in 1970 and the Congress wanted to target organized crime that had an adverse effect on the labor unions and businesses said the Justice Department.
In its replay, Bank of America Corp (NYSE:BAC) now says that this claim that the RICO has put forth is incorrect on a technical-level. The bank has said that the RICO enterprise cannot consist only of the defendants in this particular case. The bank says that the plaintiffs have actually attempted to evade the requirement by accusing the defendants of forming this enterprise with the employees of the bank itself. The bank added that the lawsuit fails to allege the specific facts and that the claims put forth by RICO has put forth are “hollow”.
Urban says that the allegations are baseless. It says that with this lawsuit the plaintiffs are impugning Urban’s sterling reputation. It is one of the United States’ fastest growing minority-owned companies and the leading minority owned mortgage-solutions provider in the country.