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Wednesday
Jun292011

Bank of America Agrees to $8.5 Billion Settlement with Investors

Davis Turner/Getty Images(NEW YORK) -- Bank of America reached an agreement Wednesday to pay $8.5 billion to settle claims by big investors who bought mortgage-backed securities and saw their value collapse when the U.S. housing market went sour.

The deal marks the biggest settlement so far from the collapse of sub-prime mortgages and could lead to others.

Mutual fund and other investors argue that they were misled about the true value of mortgage bonds.  Along with Bank of America, JP Morgan Chase, Citigroup and Wells Fargo all face big claims.

Copyright 2011 ABC News Radio

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