U.S. Sues 17 Big Banks

The federal agency that oversees the mortgage giants Fannie Mae and Freddie Mac has filed suit against 17 major banks, including Bank of America, JPMorgan Chase, Goldman Sachs, and others. The Federal Housing Finance Agency has accused the banks of mislabeling mortgages as securities to investors and failing to follow through as they were legally required to do—which caused them to miss evidence that the borrowers’ incomes were inflated or falsified. Fannie and Freddie lost more than $30 billion when borrowers were unable to pay mortgages, and the mortgages lost their value. In July, the FHFA filed a suit against UBS to recover at least $900 million. At the time, UBS vowed to "vigorously" defend all charges in court.