Chris WhalenHow would you like to be the most sued company in all of America?  That’s an honor most of us would hope not to achieve, but Bank of America has come in first place in that category.  Chris Whalen, co-founder of Institutional Risk Analytics, once again joins Dylan to highlight the latest problems with Bank of America.

“There may be no better representation of sick and desperate than the state of affairs right now at Bank of America, who absorbed not only Merrill Lynch in the financial crisis, but Countrywide,” says Dylan.

So, what’s going on with Bank of America, and why does it matter?  “They recently announced a settlement of potential claims from Fannie Mae and Freddie Mac.  These are agencies in Washington that bought over a trillion dollars in loans that Bank of America originated, or agents for Bank of America originated.  So a they had portion of these loans that have gone bad or had some defect.  And some of these agencies demanded that Bank of America buy a portion of these loans back,” says Chris.

“The settlement, however, is very small compared to what we actually thought this would be, I had a number close to $40 billion, and at the end of the day, the settlement is going to be high single-digit billions.” says Chris.

“You can give the Secretary of the Treasury discretion with how agressive he’s going to be.  But when Fannie Mae tells us that three out of four reps and warranties claims were essentially cured by Bank of America giving them more documents, I think that indicates that they were not very agressive,” says Chris.

Chris Whalen is co-founder and Managing Director of Institutional Risk Analytics, contributor to Reuters and Zero Hedge.  He is author of Inflated: How Money and Debt Built the American Dream