State Street’s Subprime Bets Cost Prudential $77M: Judge

Law360, New York (February 3, 2012, 6:09 PM EST) -- State Street Bank and Trust Co. caused $77 million in losses to two Prudential Retirement Insurance and Annuity Co. retirement funds by investing them in risky subprime mortgage-backed securities as the housing market collapsed in 2007, a New York federal judge ruled Wednesday.

U.S. District Judge Richard J. Holwell said State Street, which managed nearly 200 Prudential retirement plans, failed to limit their exposure to securities backed by subprime mortgages despite signs of an impending crisis. The judge ordered State Street to pay $76.7 million in...
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