Aspen Claims No Duty In $40M Corrupt Mortgage Class Action

Law360, New York (December 17, 2012, 5:23 PM EST) -- Aspen Specialty Insurance Co. said Friday that it had no duty to defend a Prosperity Mortgage Co. loan officer in a $40 million proposed class action over her alleged practice of inflating home estimates, falsifying documents and issuing fraudulent mortgages.

A professional liability policy and fidelity bond issued by Aspen to Prosperity should be rescinded and declared void because of material misrepresentations made by the mortgage company in its applications, the insurer said in a third-party complaint. Prosperity sued Aspen and Lloyd’s of London in July...
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