Housing Market

Better Late Than Never

Good news, federal lawsuits are being filed against mortgage villains Bank of America and Goldman Sachs, among others, for their role in marketing worthless mortgage securities to investors.

The United States plans to file lawsuits against more than a dozen big banks over mortgage-backed securities seen to have fueled the 2008 economic crisis, the New York Times said.

The lawsuits are set to be filed Friday or early next week against Bank of America, JP Morgan Chase, Goldman Sachs, Deutsche Bank and others, the newspaper reported, citing three unnamed individuals briefed on the matter.

The lawsuits will accuse the banks of bundling toxic mortgages -- held by borrowers with inflated or falsified incomes -- as securities and marketing them to investors.

To be clear -- the lawsuits will be focused primarily on the marketing of mortgage backed securities, which were dubiously rated triple-A, to the government-backed firms Fannie Mae and Freddie Mac.