HSBC Undervalued Bonds: Lawsuit

Law360, New York (October 19, 2007, 12:00 AM EDT) -- HSBC Holdings PLC has become the latest bank to be hit with a lawsuit stemming from the subprime mortgage crisis, after investment firm Luminent Mortgage Capital Inc. filed a suit alleging that HSBC used the market turmoil as an excuse to undervalue $24 million in bonds.

In a suit filed on Thursday in the U.S. District Court for the Southern District of New York, Luminent, along with fellow plaintiffs Minerva Mortgage Finance Corp. and Mercury Mortgage Finance Statutory Trust, alleged that HSBC undervalued nine sub-prime mortgaged...
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