Ambac Fights $116M NYC Tax Bill

Law360, New York (May 24, 2011, 2:31 PM EDT) -- Ambac Financial Group Inc. objected in New York bankruptcy court Monday to the City of New York Department of Finance’s $116.8 million claim for taxes and interest, deeming its treatment of the bankrupt bond insurer’s income illogical.

Ambac speculated that CNYDF arrived at the bill by assuming that three Ambac subsidiaries that are part of a New York consolidated tax group —Ambac Capital Corp., Ambac Investments Inc. and Ambac Capital Funding Inc. — earned interest income from selling securities for its guaranteed investment contract business....
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