Fannie Mae Seeks Coverage For $131M Mortgage Fraud

Law360, New York (October 21, 2010, 5:31 PM EDT) -- Fannie Mae has launched a suit seeking coverage from Lloyd's of London, Chubb Group of Insurance Cos. and other insurers for losses sustained as a result of its purchase of $131 million in fraudulent mortgage loans from U.S. Mortgage Corp.

Primary insurers Lloyd's and Chubb, as well as seven excess insurers, are obligated to provide Fannie Mae coverage for the full amount of its projected $108 million loss resulting from U.S. Mortgage's fraud under a primary- and excess-level financial institution bond, the plaintiff alleged in its...
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