Flagstar To Pay $105M To End Assured's MBS Suit
Law360, New York (June 21, 2013, 7:47 PM EDT) -- Flagstar Bancorp Inc. has agreed to pay $105 million and take responsibility for future claims to end Assured Guaranty Municipal Corp.'s New York federal court suit alleging Flagstar had misrepresented home equity loans underlying nearly $1 billion in residential mortgage-backed securities, the companies announced Friday.
The suit, filed in April 2011, claimed that the Flint, Mich.-based bank lied about the origination and underwriting of thousands of the roughly 16,000 home equity loans in two loan pools backing RMBS insured by Assured, totaling roughly $900 million.
Under the terms of the settlement, the insurer will drop the suit and will not pursue...
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