AIG Sues BofA For $10B Over RMBS

Law360, New York (August 8, 2011, 2:38 PM EDT) -- American International Group Inc. sued Bank of America Corp. for $10 billion in New York on Monday, accusing it and its units of ignoring underwriting standards and selling AIG hundreds of securities largely backed by residential mortgages issued to bad borrowers.

AIG alleged in a 187-page complaint that Bank of America, Countrywide Financial Corp. and Merrill Lynch & Co. Inc. engaged in "massive fraud" in the residential mortgage-backed securities market, in part by falsely asserting that those mortgages were issued according to objective underwriting guidelines....
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