Some staff accused of 'try(ing) to get away with anything' they could, including selling 'utter complete garbage'.
Credit Suisse bundled hundreds of mortgages into a single set of securities sold to investors in 2007 even after it had found flaws with the loans and asked the lenders to repurchase the debt, bond insurer MBIA Inc said in a court filing.
That practice was one way Zurich-based Credit Suisse maximized profit as the U.S. mortgage market melted down, while exposing investors and guarantors to losses, MBIA said in an amended complaint filed January 30th in New York State Supreme Court as part of its 2009 suit against the bank. The filing cites documents obtained through the pretrial exchange of evidence.
Bloomberg reports that the amended complaint said bank executives used the word 'shady' and a vulgarity to describe mortgage companies it bought loans from. Some of them would 'try to get away with anything' they could, including selling 'utter complete garbage', the executives said, according to MBIA. A Credit Suisse spokesman accused MBIA of mischaracterizing the evidence.
Six years after U.S. home prices began a slump of more than 30%, and a year into the recovery, mortgage-bond investors and insurers are still battling in court with banks over the hundreds of billions of dollars in resulting losses. Plaintiffs are pointing to pretrial evidence to bolster cases or bring new ones, saying the documents show the extent of Wall Street’s wrongdoing.
Hit the link below to access the complete Bloomberg article: