Senior federal prosecutor in the US has filed a lawsuit against the Bank of America for more than $1 billion on Wednesday for being involved in mortgage fraud against Fannie Mae and Freddie Mac during the time of the financial crisis.

U. S. Attorney Preet Bharara said that Countrywide Financial offered loans to people from 2007 to 2009 without making sure that they would be able to return the loans to the lender, which was later acquired by the Bank of America. It was also observed that the accusations laid against the bank are upfront.

The attorney also said that the lawsuit is aimed at recovering some of losses suffered by Fannie and Freddie due to unpaid loans. The lawsuit alleged that Countrywide sold the loans to Fannie Mae and Freddie Mac that were later not repaid by the borrowers and the company has to suffer huge losses.

Fannie and Freddie were effectively nationalized in 2008 and the federal government is not pursuing its interest against other companies. The suit also alleges that Countrywide compromised on quality for quantity as it moved to quickly approve loans assuming that the housing loan market would move forward and not backward.

Bank of America has not responded to the lawsuit yet.