Freddie Mac Attacks ResCap, FGIC Bankruptcy Deal

Law360, New York (July 30, 2013, 6:20 PM EDT) -- Freddie Mac on Monday urged a New York bankruptcy court to reject Residential Capital's recent deal with Financial Guaranty Insurance Co. to slash the bond insurer's claim against ResCap by nearly $5 billion, arguing the deal was not negotiated in good faith and would unfairly shortchange the mortgage giant.

The government-sponsored enterprise said the settlement would terminate insurance policies that guarantee the payment of principal and interest on mortgage-backed securities it holds that were issued or serviced by ResCap. Freddie Mac refuted the settlement’s finding that...
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