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Source: WSJ, AP

26 Jan 2011 


A lawsuit against Countrywide Financial Corp. and two of its former executives allege that they misled institutional investors who were stuck with huge losses from mortgage-related investments they say were portrayed as low-risk.

Filed on Monday in New York State Supreme Court , the lawsuit was brought about by investors who bought hundreds of millions of dollars in Countrywide's mortgage-backed securities from 2005 to 2007, before the housing market went bust. The list of a dozen plaintiffs includes New York Life Insurance Co., TIAA-CREF Life Insurance Co. and Dexia Holdings Inc.

The complaint names Countrywide, various subsidiaries that issued the securities, two former company executives including ex-CEO Anthony Mozilo, and Bank of America, which bought Countrywide in 2008.

Countrywide had been the nation's largest home loan originator before the housing market collapse left many of its borrowers unable to repay mortgages that in many cases required no proof of income or down payment.  Read more by going to ProgramBusiness.com

Posted 3:58 PM

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