For the third time in two weeks, a state Attorney General has filed suit against subprime lender Countrywide Financial Corp.

News of the suit arrives on the same day that Bank of America (BofA) announced that it has completed its acquisition of Countrywide Financial Corp. This time, Florida Attorney General Bill McCollum is the plaintiff on behalf of the entire state and his list of allegations have a similar tone to them.

“Our legal services programs throughout the state have seen a large number of clients who are now in default on mortgages written by Countrywide,” said Marc Taps with Legal Services of North Florida. “It appears to us Countrywide did no due diligence and accepted applications which were patently fraudulent and reflected no ability on the part of borrowers to make the required payments.”

McCollum's office says Countrywide received the fringe benefits of the secondary mortgage market by originating a high volume of loans and selling them off. However, the Attorney General says Countrywide originated the high volumes by ignoring whether the borrowers had the ability to pay while also hiding the negative effects of teaser loan rates.

“Traditionally, lenders require borrowers to document income and assets, but investigators with the Attorney General's Office believe Countrywide offered reduced or no documentation loan programs to increase its loan sales,” McCollum's office said. “Countrywide also allegedly paid greater compensation to brokers for loans with higher interest rates and prepayment penalties because it could sell those loans for higher prices on the secondary market.”Kerri Panchuk