Crime: In a stunning revelation, Credit Suisse Securities (USA) LLC has been accused of making fraudulent misrepresentations and omissions to promote the sale of Residential Mortgage-Backed Securities (RMBS) to investors. The Residential Mortgage-Backed Securities Working Group Co-Chair New York Attorney General Eric T. Schneiderman filed a Martin Act complaint against the defendant.
According to the complaint, Credit Suisse deceived investors as to the care with which they evaluated the quality of mortgage loans packaged into residential mortgage-backed securities prior to 2008. The lawsuit also alleges that RMBS sponsored and underwritten by Credit Suisse in 2006 and 2007 have suffered losses of approximately $11.2 billion.
This is the fourth enforcement action from the Residential Mortgage-Backed Securities Working Group, a joint federal and state initiative created by President Obama earlier this year to investigate those responsible for misconduct contributing to the financial crisis through the pooling and sale of RMBS.
Defendant: Credit Suisse Securities (USA) LLC
Criminal Charges: Making fraudulent misrepresentations and omissions to promote the sale of RMBS to investors
City and State: New York
Date: Not specified
Sentence or Outcome: The lawsuit is ongoing
Dollar Amounts: $11.2 billion in losses
Rule: The defendant must submit to a Martin Act complaint and face potential penalties
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Key Facts
- State: New York
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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