Texas Bank Hits UBS, Others With $113M MBS Suit

Law360, New York (November 14, 2011, 5:34 PM EST) -- Texas-based Town North Bank NA on Friday accused UBS Financial Services Inc., Morgan Stanley & Co. LLC and others of costing Town North approximately $113 million by misrepresenting the quality of their mortgage-backed securities.

The banks purposefully misled Town North and did not disclose that the assets underlying the securities were at greater risk of loss than they had suggested at the time of sale, allegedly omitting facts concerning credit default swaps and credit sensitivity of the securities, according to the complaint filed in Texas federal...
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