A former executive of Bank of America's Countrywide unit told a federal jury on Tuesday that she did not knowingly sell toxic mortgages to Fannie Mae and Freddie Mac in the run-up to the financial crisis.
Reuters reports that Rebecca Mairone, a former chief operating officer of Countrywide's Full Spectrum Lending Division, is the lone individual defendant in the lawsuit brought by the U.S. government against the bank, which acquired Countrywide in 2008.
The trial, now in its fourth week in U.S. District Court in Manhattan, is centred on the government's allegations that Countrywide defrauded Fannie Mae and Freddie Mac, the government-sponsored mortgage finance companies, by selling them thousands of defective mortgages. Countrywide sped up approvals to unqualified lenders in a process it called the 'high-speed swim lane', or 'Hustle'.
Mairone, who oversaw the process, is one of only a handful of individual defendants in lawsuits the government has filed against major financial institutions over improper mortgage practices since the housing market meltdown. The Countrywide case is the first such case to reach trial.
At the start of Mairone's testimony, her lawyer, Marc Mukasey, asked a series of questions about whether she had deliberately sold substandard mortgages to Fannie and Freddie.
'No, never', she replied.
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image: © Clyde Robinson