Bank of America and RICO Enforcement

This excerpt from American Banker about rumblings of RICO claims against BoA and “friends,” full article here:

But, Mark Malone – a former U.S. and New Jersey prosecutor with RICO experience – firmly believes that the statute could prove a legal trumpet that could bring down the Jericho-style battlements of B of A.

Factually and legally, he claims, there’s no impediment to using the RICO statute to prosecute current and former executives at Bank of America if a “pattern of racketeering activities” can be alleged, meaning people in the organization having committed two or more acts within a 10-year period that violate federal statutes prohibiting the use of the mail or the “wires” (defined as telephonic, and now Internet, communication) to carry out fraudulent schemes. (Malone, serving as a volunteer lawyer for South Jersey Legal Services, is fighting B of A in a client’s foreclosure case.) He, Angle and others in the group believe that much of what went on during Countrywide’s descent into infamy, and its acquisition by B of A, met the fraud criteria.

Malone and Angle doubt Eric Holder’s Department of Justice will wield RICO as a weapon, pointing out that Holder and the DOJ’s Criminal Division head, Lanny Breuer, are both former partners of the white shoe law firm Covington and Burling. That might pose a problem for the two if a RICO investigation were to move forward with alacrity. As Reuters reported on Jan. 20, the firm’s connective tissue binds it to clients that have included Bank of America, Fannie Mae and Freddie Mac, and its lawyers wrote opinions supporting the legality of MERS’ securitization activities.

So, is the use of RICO by DOJ just wishful thinking on the part of this group of legal crusaders? For now, maybe, but there is some action on the state level. Louisiana, for one, has just filed a RICO complaint against MERS and a whole host of megabanks, B of A included. The suit alleges that the defendants used the wires and the mails in a scheme to defraud parishes out of recording fees.

Down the line, Angle, Malone and others hope that what Occupy may not be able to accomplish, hard-nosed prosecutors might be able to provide: a measure of justice for the millions of aggrieved homeowners either forced out in foreclosure, or waiting for that ax to fall as a result of the actions of Bank of America and its cohorts.

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