HSBC Denies Overvaluing Bonds, Files Counterclaims

Law360, New York (November 30, 2007, 12:00 AM EST) -- Hit with a lawsuit alleging that it undervalued subprime mortgage-backed bonds, investment bank HSBC Securities Inc. has fired back, denying the allegations and filing several counterclaims of its own.

In a filing made on Friday in the U.S. District Court for the Southern District of New York, HSBC refuted the allegations made by Luminent Mortgage Capital Corp., Minerva Mortgage Finance Corp. and Mercury Mortgage Finance Statutory Trust, which claim that HSBC undervalued $24 million in subprime mortgage-backed bonds.

The bank also filed eight counterclaims, accusing the...
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