CIFG Sues Goldman Over $275M In Bad Mortgages

Law360, New York (August 17, 2011, 5:23 PM EDT) -- CIFG Assurance North America Inc. sued Goldman Sachs & Co. on Tuesday in New York, claiming the investment bank sugarcoated more than $275 million in bad home mortgages to shift its risk to the the bond insurer when the loans started to fail.

The plaintiff alleges Goldman misrepresented its underwriting standards and those used by the banks that originated the loans, including co-defendant M&T Bank Corp., even as an internal review raised red flags about several lenders.

The suit stems from a 2007 transaction in which...
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