Pursuits
Credit Suisse Put ‘Garbage’ Mortgages in Bonds, MBIA Says
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Credit Suisse Group AG bundled hundreds of mortgages into a single set of securities sold to investors in 2007 even after it had found flaws with the loans and asked the lenders to repurchase the debt, bond insurer MBIA Inc. said in a court filing.
That practice was one way Zurich-based Credit Suisse maximized profit as the U.S. mortgage market melted down, while exposing investors and guarantors to losses, MBIA said in an amended complaint filed Jan. 30 in New York State Supreme Court as part of its 2009 suit against the bank. The filing cites documents obtained through the pretrial exchange of evidence.