BofA Ordered to Compensate Countrywide Fraud Whistleblower
More trouble for Bank of America related to its acquisition of the subprime mortgage giant Countrywide: The U.S. Department of Labor says the company illegally retaliated against an employee who tried to blow the whistle on mortgage fraud. The Department of Labor says Bank of America fired the whistle-blowing employee shortly after it merged with Countrywide three years ago. The employee - whose name has not been released - claims to have uncovered widespread fraud involving Countrywide employees. The Department of Labor says Bank of America illegally fired the employee for blowing the whistle. But Bank of America says in a statement the dismissal was based solely on "the employee's management style." The bank also says it did investigate - and address - the claims of fraud. The Department of Labor has ordered Bank of America to reinstate and pay the former Countrywide employee approximately $930,000 in back wages, damage compensation and legal fees. Bank of America has 30 days to challenge the order, which it plans to do. Lawsuits related to Countrywide's mortgage operation are piling up and may ultimately cost Bank of America billions of dollars to resolve.