RBS to pay $125 million to settle California mortgage bond claims

The Royal Bank of Scotland Group Plc will pay $ 125 million to settle complaints that it made misleading statements by selling mortgage-backed securities to two large California pension funds, announced Attorney General of the State.

The settlement announced Friday by California Attorney General Xavier Becerra was the latest in RBS to resolve claims arising from its sale of mortgage-backed securities, which were at the heart of the 2008 financial crisis .

Becerra 's office stated that these securities were generally secured by thousands of variable quality mortgages in which the buyer relied on the assurance that these mortgages were carefully controlled and did not have to. were not too risky.

Becerra's office also said that its investigations revealed that RBS had not properly disclosed to investors the true features of many of the thousands of mortgage loans underlying the securities.

The investigation also revealed that these misrepresentations resulted in multi-million dollar losses for the California Public Employees Retirement System and the California State Teachers' Pension System, said the Becerra office.

"RBS has decided to mislead California pension funds in order to self-feed – plain and clear," Becerra said in a statement.

RBS chief executive Ross McEwan said in a statement Saturday that the bank was pleased to have reached the mortgage-backed securities issue by-law between 2004 and 2008.

"We were very clear that the resolution of our remaining legacy issues is a key part of our strategy," he said.

The settlement comes as RBS continues to seek to resolve a US Department of Justice investigation into its mortgage-backed securities sales before the financial crisis.

In July, RBS agreed to pay $ 5.5 billion to resolve a complaint filed by the Federal Housing Finance Agency, the curator of Fannie Mae and Freddie Mac, claiming that she had misleads the American giants by buying mortgage backed securities.

In September 2016, the US National Credit Union Administration announced that RBS had agreed to pay $ 1.1 billion to settle claims on mortgage-backed securities that it had sold to credit unions who then failed.

Source link