Insurer Targets Bear Stearns Over $75M MBS Loss

Law360, New York (March 15, 2012, 8:52 PM EDT) -- Assured Guaranty Corp. launched a suit in New York state court Thursday over Bear Stearns & Co. Inc. mortgage-backed securities that have lost about $75 million, saying Bear Stearns misrepresented the securities' risk and won't honor contractual buyback obligations.

Assured, which insured mortgage-backed securities issued in a 2005 transaction, says it's had to pay $43 million in claims through October and has set aside tens of millions of dollars more in reserves based on expected future liabilities. The insurer says it only issued the policy because...
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