The ongoing saga of major bank settlements with the Department of Justice, Fannie Mae and Freddie Mac is mostly the result of the economic crisis of 2007-2008. Prior to this time, Bank of America and JPMorgan Chase & Co. sold billions of dollars in mortgage loans and mortgage securities to Fannie Mae and Freddie Mac. Fannie Mae and Freddie Mac are government-affiliated companies that purchase mortgages from lenders and sell them to investors. Accusations have been made that the mortgages purchased by Fannie Mae and Freddie Mac were higher risk and more problematic than BOA or JPMorgan Chase expressed.

Fannie Mae and Freddie Mac have actively pursued the repurchase of loans that did not meet their lending standards upon origination in an effort to recoup their losses. In October 2013, the Federal Housing Finance Agency, acting on behalf of Fannie Mae and Freddie Mac, reached a $5.1 billion settlement with JPMorgan Chase. The settlement resulted from accusations that JPMorgan Chase violated federal and state securities laws when misrepresenting the quality of the sub-prime mortgage loans and securities sold to the two companies, which resulted in billions in damages to the companies during the 2008 financial crisis.

In January 2013, BOA settled with Fannie Mae over faulty lending practices by one of its subsidiaries, Countrywide Financial Corporation. Fannie Mae had accused the BOA subsidiary of utilizing faulty lending practices on $1.4 trillion in mortgages sold to them as investment products. In the settlement, BOA paid Fannie Mae $3.55 billion and repurchased $6.75 billion in outstanding residential mortgage loans. This substantively resolved all outstanding disputes between BOA and Fannie Mae. In 2011, BOA settled with Freddie Mac and Fannie Mae for over $3 billion in a similar agreement. In this agreement, Freddie Mac was given roughly $1.3 billion and Fannie Mae received over $1.3 billion.

In November 2013, the Court of Appeals for the Second Circuit dismissed a case by investors against Freddie Mac accusing the company of hiding the extent of exposure it had to the sub-prime mortgage crisis saying the case lacked any real evidence.