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Bank of America in record $16.7bn mortgage settlement

21 August 2014 Last updated at 22:13 BST

Bank of America has agreed to pay a record $16.7bn (£10bn) to US authorities for misleading investors about the quality of loans it sold.

The loans were sold by Countrywide Financial and Merrill Lynch before Bank of America bought them in 2008, at the height of the financial crisis.

The associate attorney general said "no institution is either too big or too powerful to escape" punishment.

The settlement will cut the bank's third-quarter profits by $5.3bn.

Michelle Fleury reports.

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