Allstate Corp has taken legal actions against Bank of America Corp, its Countrywide lending unit and seventeen other defendants for allegedly misrepresenting the risks on more than seven hundred million dollars worth of mortgage securities it bought from Countrywide.

The largest publicly traded U. S. home and auto insurer, Allstate, brought allegations stating that it suffered considerable amount of losses after Countrywide misled the company into believing that the securities were safe, and a high quality of home loans were supporting them.

The case filed also named many former Countrywide officials as defendants, including Angelo Mozilo the longtime Chief Executive. Countrywide was the biggest U. S. mortgage lender before it was bought by Bank of America in July 2008.

Allstate said that it started in 2003, when Countrywide quietly decided to increase its market share and ignore its own underwriting standards by giving approval to any mortgage product that a competitor was willing to offer. Countrywide in turn passed on the accumulated risks to investors who purchased debt supported by the mortgages as stated by Allstate.

Defendants were aware that the loans offloaded onto Allstate were a risky mix of loans given to loan takers that could not afford the properties, and thus were having fair chances of default as per the statement of the one hundred and fifty page complaint filed in Manhattan federal court on Monday.

Allstate is looking for undoing its securities purchases, which took place between 2005 and 2007, and some unspecified damage suffered by the company.

The company based in Northbrook, Illinois followed the footsteps of Charles Schwab Corp, the Federal Home Loan Banks and other firms in charging lenders for allegedly misleading them about mortgage securities. The largest U. S. bank by assets, Bank of America, said last month that it faced lawsuits over fifty four billion dollars.