{"id":1841,"date":"2017-03-09T08:00:37","date_gmt":"2017-03-09T08:00:37","guid":{"rendered":"https:\/\/sentencing.net\/?p=1841"},"modified":"2019-11-12T16:08:12","modified_gmt":"2019-11-12T21:08:12","slug":"restitution-improper-bank-america","status":"publish","type":"post","link":"https:\/\/sentencing.net\/sentencing\/restitution-improper-bank-america","title":{"rendered":"Restitution For Bank of America In Mortgage Fraud Prosecution Improper"},"content":{"rendered":"\r\nBank of America is not entitled to restitution as a \u201cvictim\u201d under the Mandatory Victims Restitution Act for bad loans issued during the 2007-2008 housing crash, the U.S. Court of Appeals for the Seventh Circuit recently held. See United States v. Litos<\/a><\/em>, 847 F.3d 906 (7th Cir. 2017). Three defendants were ordered to pay $893,015 in restitution to Bank of America for their involvement in a bank fraud prosecution surrounding fraudulent mortgage applications. In spite of the bank\u2019s reckless conduct surrounding the loans, the court-ordered restitution.\r\n

The Seventh Circuit reversed.<\/p>\r\n

\u201cWe are mindful that the federal criminal code requires \u2018mandatory restitution to victims of certain crimes, 18 U.S.C. \u00a03663A (the Mandatory Victim Restitution Act of 1996, usually referred to as the MVRA<\/a>), including fraud, see \u00a03663A(c)(1)(A)(ii), but only for \u2018an offense resulting in damage to or loss or destruction of property of a victim of the offense.\u2019 3663A(b)(1). That doesn’t seem to describe the loss suffered by Bank of America as a result of its improvident loans, especially when we consider its complicity in the loss\u2014its reckless decision to make the loans without verifying the solvency of the would-be borrowers, despite the palpable risk involved in, for example, providing mortgage loans to a person who applies for six mortgages in ten days.\u201d<\/p><\/blockquote>\r\n

The court continued that:<\/p>\r\n

\u201cHad the bank done\u00a0any<\/em>\u00a0investigating at all, rather than accept at face value obviously questionable claims that the mortgagors were solvent, it would have discovered that none of them could make the required down payments, let alone pay back the mortgages. These people were just fronts for the defendants, who made the down payments required by the bank, pocketed the mortgage loans (which were of course much larger than the down payments) that the bank made, and left it to the nominal mortgagors to default since they hadn’t the resources to repay the bank. All this was\u00a0transparent<\/em>.\u201d<\/p><\/blockquote>\r\n

Accordingly, the court concluded that Bank of America was not a \u201cvictim\u201d for restitution<\/a> purposes.<\/p>\r\n

The court of appeals, however, did encourage the district court to assess on remand whether the defendants should be fined in an equal amount to the restitution that had been previously ordered.<\/p>\r\n

The case was remanded for resentencing.<\/p>\r\n","protected":false},"excerpt":{"rendered":"

Bank of America is not entitled to restitution as a \u201cvictim\u201d under the Mandatory Victims Restitution Act for bad loans issued during the 2007-2008 housing crash, the U.S. Court of Appeals for the Seventh Circuit recently held. See United States v. Litos, 847 F.3d 906 (7th Cir. 2017). Three defendants were ordered to pay $893,015…<\/p>\n","protected":false},"author":1,"featured_media":1843,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[314],"tags":[],"yoast_head":"\nBank of America Restitution | Bank Fraud | Housing Crash | Sentencing.net\u00a0<\/title>\n<meta name=\"description\" content=\"Bank of America is not entitled to restitution as a \u201cvictim\u201d under the Mandatory Victims Restitution Act for bad loans in housing crisis, Court holds.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/sentencing.net\/sentencing\/restitution-improper-bank-america\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Bank of America Restitution | Bank Fraud | Housing Crash | 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