Nomura and Royal Bank of Scotland may face $500m in damages for what a judge called an 'enormous' deception in the sale of defective mortgage-backed securities, a ruling that may spur other banks to settle similar claims tied to the 2008 financial crisis.
Bloomberg News reports that Nomura and RBS were excoriated in a 361-page opinion by U.S. District Judge Denise Cote in Manhattan, whose ruling followed the first trial of claims that banks sold flawed securities to government-owned mortgage companies.
'The offering documents did not correctly describe the mortgage loans', Cote, who heard the case without a jury, wrote Monday. 'The magnitude of falsity, conservatively measured, is enormous'.
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