The Justice Department has filed a lawsuit against the Bank of America on Tuesday arguing that the bank by understating the risks of mortgages backing some $850 million in securities to the investors.

The latest lawsuit is another financial burden for the bank, which has been facing several mortgage-related losses and litigation since the collapse of the housing market in the US. Most of the legal challenges are a result of acquisition of the subprime lender Countrywide Financial by the bank in 2008 in the US.

The new lawsuit is linked to Bank of America's own home-grown mortgage operations and not those extended by the Countrywide Financial. The laons were presented as prime jumbo mortgages in 2007 as they included loans of more than $417,000 for a single-unit dwelling and not the subprime mortgages.

The Justice Department said in the lawsuit that the bank's mortgage operations represent the inappropriate business practices adopted by the Wall Street firms ahead of the financial crisis of 2008. It said that the bank pushed employees to churn through mortgage evaluations in order to generate additional profits. The instructions to fly through standards came from the leadership of the bank, according to the lawsuit.