Report: RMBS working group eyes 16 banks
Sept. 26, 2013 – A Justice Department-led residential mortgage-backed securities working group is investigating the activities of 16 banks in the lead-up to the financial crisis, Bloomberg said Wednesday.
Bloomberg was reporting on a complaint filed in federal court Tuesday by Clayton Holdings LLC, which is calling Justice’s request for its clients’ information a “fishing expedition.”
This report follows on the heels of NCUA’s announcement late Monday that it has filed 10 new lawsuits seeking recoveries from losses on mortgage-backed securities investments that led to the downfall of five corporate credit unions.
Bloomberg, in its report, quotes a Clayton Holdings lawyer objecting to Justice’s request for “every document and communication for all 193 clients and almost 5,000 e-mail custodians, in violation of Clayton’s rights under the Fourth Amendment.”
Clayton Holdings specializes in mortgage due diligence. In the Bloomberg report, it did not identify which 16 clients the working group – part of the Justice-led Financial Fraud Task Force – is investigating. The RMBS working group includes representatives from Justice, the Securities and Exchange Commission, the U.S. attorney for the Colorado district and New York’s attorney general.
As quoted by Bloomberg, Clayton alleges that two other third-party firms were subpoenaed as well – LPS Credit Risk Solutions and LPS Valuation Solutions.
RMBS working group
"NCUA sues over LIBOR manipulation," 9/24