Wells Fargo to Pay $2 Billion in Mortgage Loans Case

 Wells Fargo agreed to pay a $2.09 billion penalty for issuing mortgage loans it was aware contained incorrect income information, the Department of Justice said Wednesday.

The bank agreed to pay the civil penalty under the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 for the actions, which the government said contributed to last decade's financial crisis.

"Abuses in the mortgage-backed securities industry led to a financial crisis that devastated millions of Americans," acting U.S. attorney for the Northern District of California, Alex G. Tse, said. "Today's agreement holds Wells Fargo responsible for originating and selling tens of thousands of loans that were packaged into securities and subsequently defaulted. Our office is steadfast in pursuing those who engage in wrongful conduct that hurts the public."

Under the deal Wells Fargo agreed to pay the penalty without admitting liability to resolve all civil claims under FIRREA. The government agreed to release Wells Fargo from any potential claims arising under the Program Fraud Civil Remedies Act, the Injunctions against Fraud Act and on certain other grounds, the company said in a statement.