November 14, 2012
Judge Cote (SDNY) Allows FHFA To Proceed in Suit Against JPMorgan
The court said that the FHFA, Fannie and Freddie’s regulator, can proceed with its securities fraud claim relating to billions of MBS bought by the two mortgage companies. The allegations turn on allegedly false representations made by the bank relating to the mortgages underlying the securities.
The quoted representations are pretty strong. One reads:
depositor will not include any loan in the trust fund for any series of
securities if anything has come to the depositor’s attention that would
cause it to believe that the representations and warranties of a seller or
originator will not be accurate and complete in all material respects in
respect of the loan as of the date of initial issuance of the related series of
securities.
The Opinion and Order can be found here:
https://bit.ly/PX00xX
