Today in Insanely Rich and Enormous Companies Paying to Make Things Go Away

A blog about business and economics.
July 16 2014 5:54 PM

Today in Insanely Rich and Enormous Companies Paying to Make Things Go Away

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The Justice Department is coming.

Photo by Scott Olson/Getty Images

Two big pieces of settlement news today: Bank of America offered $13 billion to settle a mortgage-securities probe from the Justice Department and Apple agreed to pay $450 million over colluding with publishers to fix e-book prices.

The $13 billion settlement proposed by Bank of America would be almost twice the $7 billion settlement Citigroup announced two days ago over a similar investigation into its handling of rotten loans. But nothing is set yet for BoA. Its meeting with the DOJ on Tuesday ended with "no progress made toward a final deal." Shares of BoA slipped 1.9 percent on Wednesday after the bank reported a 43 percent drop in its second-quarter profit on legal charges of $4 billion.

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Now, to Apple. One month ago, a letter filed with the Southern District of New York showed that Apple had reached a settlement with consumers and U.S. states in a civil class action lawsuit over fixing the prices of e-books. Newly unsealed terms show that of the $450 million Apple has agreed to pay, $400 million would go to consumers. That said, the settlement is conditional on an appeals court ruling that could significantly reduce or eliminate altogether the amount Apple owes.

Alison Griswold is a Slate staff writer covering business and economics.

 

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