The former Countrywide executive is collecting millions for helping federal prosecutors force Bank of America to pay a record $16.7 billion penalty.
A former Countrywide Financial executive is collecting millions after helping federal prosecutors force Bank of America to pay a record $16.7 billion penalty.
Edward O’Donnell will receive a $57 million award for a whistleblower lawsuit he filed, which accused Countrywide of defrauding Fannie Mae and Freddie Mac by selling them loans that were not as good as the company represented them to be. O'Donnell reached an agreement last week with the government that enables him to collect part of the settlement that Bank of America agreed to pay in August.
“In my opinion, Edward O’Donnell is the person most responsible for bolstering the bank settlements and holding Wall Street accountable,” David Wasinger, the lawyer for O’Donnell, told The New York Times. Bank of America acquired Countrywide for $4 billion in early 2008.
Bank of America’s record settlement with the government is over sales of shoddy mortgage-backed securities during the run-up to the financial meltdown. The settlement is the largest with a single corporation in U.S. history.
The U.S. Department of Justice is requiring the bank to pay $9.65 billion in cash to resolve more than a dozen federal and state investigations and provide $7 billion in consumer relief. The deal also requires the bank to acknowledge misrepresenting the quality of mortgage-backed securities it sold, as well as those sold by its Countrywide and Merrill Lynch units.
