Credit Suisse was sued for more than $350m by entities of Highland Capital Management LP who claim it marketed loans for high-end residential communities including the Yellowstone Club in Montana based on unreasonable and deceptive appraisals.
Bloomberg News reports that the dispute stems from dividend capitalization loans for Yellowstone, the Turtle Bay Resort in Hawaii, the Park Highlands Master Planned Community in North Las Vegas, Ginn Clubs & Resorts and Rhodes Homes, according to a court filing July 16 in New York State Supreme Court in Manhattan.
The plaintiffs, Allenby LLC and Haygood LLC, were assigned the claims by managed investment funds that participated as lenders to the loans, according to the suit. They accused Zurich-based Credit Suisse of using 'compliant stooges in two global appraisal firms' to overvalue the communities that secured the loans to persuade the lenders to invest.
'Armed with these bogus appraisals, Credit Suisse duped the lenders into investing hundreds of millions of dollars in under-collateralized loans that eventually imploded', according to the plaintiffs.
In the meantime, Bloomberg also reports that Barclays has said Abu Dhabi’s Sheikh Mansour bin Zayed Al Nahyan no longer owns the company’s shares.
His PCP Gulf Invest 3 Ltd. liquidated its 758.4m Barclays shares as of June 20, according to a filing last month from the London-based bank.
Barclays raised $8.1bn from Qatar and Abu Dhabi in October 2008 as it sought to avoid taking funds from the U.K. government at the peak of the financial crisis. In 2010, PCP converted the warrants it had acquired into stock at about 198 pence a share.
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