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On Aug. 21, 2014, Attorney General Eric Holder walked to a podium at the Department of Justice, flanked by government officials, and announced his agency had reached a record $16.6 billion settlement with Bank of America.“The largest civil settlement with a single entity in history,” he said.

The settlement was one of many that large institutions agreed to pay in the aftermath of the financial crisis. Since 2009, financial institutions have paid nearly $250 billion for the part they played in the meltdown, according to Keefe, Bruyette & Woods, which has tracked fines over $100 million.

Bank of America agreed to this record penalty to settle lawsuits and investigations into how it and companies it bought, including Countrywide Financial and Merrill Lynch, issued mortgages, packaged them together and sold those bundles to investors. It then marketed those residential mortgage-backed securities to investors as more secure than it knew them to be.

During the press conference, Associate Attorney General Tony West compared the banks’ behavior to a grocery store selling milk to customers that it knew had been left out on a loading dock, unrefrigerated, the entire day before.

Where the money went

The funding was directed at three main recipients: the federal government, a handful of states, and consumers.

“[The settlement] was designed to not only punish Bank of America, but to provide assistance to people — individuals who were injured,” said Eric Green, an independent monitor for a portion of the BoA settlement.

But while the bank finished its obligations under the settlement in 2016, two years ahead of schedule, some of the money has yet to reach its final destination.

Federal government

Nearly half the $16.6 billion went to the Department of Justice. DoJ sent just over $6 billion of that to the Treasury Department, which went into the general fund that pays for government operations, much in the same way taxes do.

A smattering of federal agencies connected to the settlement also received money, including the Federal Deposit Insurance Corporation, Federal Housing Administration, and Securities and Exchange Commission.

Most of the award to the Securities and Exchange Commission — $115 million of the $135 million it was allocated — was to be returned to investors harmed by a certain mortgage-backed securities, but, according to court documents, that funding likely won’t be paid out until early 2020. The SEC, which declined to comment, didn’t submit a distribution plan, detailing how it will disperse that cash, for court approval until May of this year. The agency is now in the process of soliciting and reviewing claims from investors who may be eligible for compensation.

Six states

Bank of America also paid nearly $950 million to six states involved in the investigations and cases that helped lead to the settlement: California, Delaware, Illinois, Kentucky, Maryland, and New York.

California and Illinois, for example, directed their portion to state pension funds that had invested in mortgage-backed securities.

New York took a different approach. Along with funding from other large bank settlements, its attorney general set up numerous consumer- and housing-related programs, such as counseling for homeowners or demolishing vacant properties.

Consumer relief

Finally, the settlement allocated $7 billion for consumer relief, such as modifying mortgages, lending to low- or moderate-income borrowers, funding neighborhood stabilization efforts, or donating to foreclosure prevention and legal assistance programs.

The agreement also included some incentives: If the bank funded certain programs or got the money out quickly, it could reduce its overall bill.

“It wouldn't surprise me if it was less than $5 billion in actual cost,” Green said.

The largest chunk of consumer relief funding went to mortgage modifications. The bank received just over $5 billion in settlement credit for modifying about 90,000 mortgages to help people stay in their homes.

It also provided financing for 5,000 affordable housing units across the country. The bank donated almost 1,500 properties and distressed mortgages as part of the settlement, as well as $14 million to help rehabilitate or maintain them.

Most of those properties went to a nonprofit called the National Community Stabilization Trust. Of the roughly 1,000 properties it received, 125 are in still the foreclosure process. The organization will then figure out what to do which each property, such as donating it to a local nonprofit to fix up or demolish. That work is expected to take until 2019.

Impact

“As big as this program was, and this was the largest program of its kind, in a sense it's still insufficient for the harm caused by the mortgage crisis and the bursting of the housing bubble,” Green said, reflecting of the settlement’s impact.

He estimates about 150,000 people may have received some form of aid through the settlement.

“What's more,” he added. “This settlement happened in 2014 and the bank completed its consumer relief obligations in two years instead of the four years it had. It did it very fast, but it was still too late for too many people.”

All these years later, figuring out what the settlement cost the bank and what impact that money had is difficult. Bank of America declined to comment.

“I think there are a lot of questions about how much of this was win-win, how much of this would banks have done anyway,” said Tom Perrelli, a former associate attorney general of the United States who is now the independent monitor for a similar but smaller settlement with Citigroup.

Perrelli said modifying mortgages or donating distressed properties, for example, can have benefits for the bank.

But he thinks financing of affordable housing will “prove to have been an incredibly beneficial aspect of these agreements.”

One such project still under construction in the Bronx, an apartment building that will rent units at below-market rates, received $4 million through the Bank of America settlement, which helped to close a funding gap and cover amenities like a gym and solar panels. For its contribution, the bank was able to claim nearly $15 million of settlement credit.

“It’s a fresh look, it’s a welcoming look,” said social worker Michael DeBerry, who’s hoping he and his wife might qualify for one of these apartments. “The housing market’s getting really really difficult in all the five boroughs and its becoming increasingly difficult here in the Bronx.”

Ten years after the financial crisis and four years after this settlement was announced, the building is nearing completion. Tenants will likely start moving in next month.

This story is part of Divided Decade, a yearlong series examining how the financial crisis changed America. 

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Follow Tracey Samuelson at @tdsamuelson