Wells Fargo & Co has alleged that the new suit against the company filed by federal prosecutors in a New York court regarding home lending abuses is in violation with the settlement of an earlier settlement.

Wells Fargo said that all liabilities were erased in the settlement with federal and state officials in April following a massive investigation of violations in the house lending segment in the country. The latest New York fraud lawsuit was filed in 9 October and is seeking hundreds of millions of dollars from the company for allegedly certifying loans as eligible for Federal Housing Administration insurance for more than 10 years.

The company responded by saying that the False Claims Act suit is in violation with the earlier settlement under which the bank paid more than $5 billion. The company had to pay the settlement and sure freedom from all further legal proceedings relating to the matter.

The company said that, the settlement "wiped the slate clean for Wells Fargo in terms of facing any further liability to the United States for a wide range of Wells Fargo conduct relating to its Federal Housing Administration ... mortgage loan portfolio."