US Readies Suit Against Big Banks over Bad Bundled Mortgages
Posted Sep 2, 2011 6:22 AM CDT
By Debra Cassens Weiss
The federal agency that oversees Fannie Mae and Freddie Mac is prepared to file lawsuits against more than a dozen big banks over troubled mortgage securities.
The suits will allege the banks misrepresented the quality of mortgages that were bundled and sold to investors, sources tell the New York Times.
The Federal Housing Finance Agency has already sued UBS AG, and is preparing suits against banks that include Bank of America, JPMorgan Chase, Goldman Sachs and Deutsche Bank. The suits will seek reimbursement for securities losses incurred by Fannie and Freddie.
The complaints are expected to be filed today or Tuesday.