Law360, New York (January 26, 2012, 8:18 PM ET) -- German bank Bayerische Landesbank and Belgian bank Dexia SA hit Morgan Stanley with separate lawsuits in New York on Wednesday accusing the financial services giant of fraud in the creation and sale of nearly $1.2 billion in residential mortgage-backed securities.
Morgan Stanley knew about the poor quality of the loans that it securitized but misled BayernLB, Dexia and other investors into thinking they were safe investments, the banks contend in their lawsuits.
“This misconduct has resulted in astounding rates of default on the loans underlying the...
European Banks Take On Morgan Stanley Over $1.2B In RMBS
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