HBSC to pay $550m to settle faulty mortgage bond claims

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HSBC will pay $550 million to resolve accusations of misconduct in its handling of mortgage securities sold to taxpayers before the financial crisis.

Bloomberg News reports that the U.S. unit of the London-based bank, HSBC North America Holdings Inc., reached the deal to end Federal Housing Finance Agency claims that the firm sold faulty mortgage bonds to Fannie Mae and Freddie Mac from 2005 to 2007, the bank said in a statement.

Fannie Mae will receive $176 million and Freddie Mac will get $374 million, according to a separate statement from FHFA.

'We are pleased to have resolved this matter,' Stuart Alderoty, general counsel for HSBC’s U.S. unit, said in the statement. All principal and interest payments have been made on the securities at issue in the settlement, the bank said.

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HSBC Agrees to Pay $550 Million to End U.S. Mortgage Claims

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