Insurer Skirts Coverage For $20M Fremont Mortgage Loss

Law360, New York (April 4, 2013, 2:34 PM EDT) -- A California federal judge on Wednesday freed Federal Insurance Co. from a $20 million suit brought by bankrupt wholesale lender Fremont Investment and Loan’s successor seeking to cover losses from a mortgage fraud scheme.

U.S. District Judge James V. Selna said financial institution bonds issued to Fremont contained a couple of exclusions that void any coverage the insurer might have owed Fremont's successor, Signature Group Holdings, for losses it suffered from Fremont's funding of $20 million in fraudulent loans for an alleged criminal enterprise referred to...
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