This just in from Reuters. New York Attorney General Eric Schneiderman is suing JP Morgan over mortgage-backed securities. This specifically has to do with Baer Stearns, the defunct investment bank JPM bought at the height of the financial crisis.
Here’s the Tweet that let us know:
You can check out the complaint here from Reuters. Here’s part:
Defendants committed multiple fraudulent and deceptive acts in promoting and selling its RMBS. For example, in publicly filed documents and in marketing materials. Defendants led investors to believe that Defendants had carefully evaluated – and would continue to monitor – the quality of the loans in their RMBS. In fact, Defendants systematically failed to fully evaluate the loans, largely ignored the defects that their limited review did uncover, and kept investors in the dark about both the inadequacy of their review procedures and the defects in the underlying loans. Furthermore, even when Defendants were made aware of these problems, they failed to reform their practices or to disclose material information to investors. As a result, the loans in Defendants’ RMBS included many that had been made to borrowers who were unable to repay, were highly likely to default, and did in fact default in large numbers.
We’ll keep going through this and letting you know what we find.
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- Too Big To Jail: Wall Street Executives Unlikely To Face Criminal Charges, Source Says (huffingtonpost.com)
- Yes, Really, Truly, No Joke, That Schneiderman Mortgage Task Force is Gonna Get Someone….Soon! (nakedcapitalism.com)
- JPM’s Woes Grow With New Money Laundering Probe: Remember Bill Murphy Told Us “JP Morgan is FINISHED!” (sgtreport.com)
- Schneiderman Investigating Bain Capital, Amid No News of Any Investigation on Mortgage Fraud Task Force (news.firedoglake.com)