Ally Settles Feds' Mortgage Suits, Records $170M Charge

Law360, Los Angeles (October 29, 2013, 10:46 PM EDT) -- Ally Financial Inc., former parent of bankrupt Residential Capital LLC, announced Tuesday that it will record a $170 million charge in the third quarter after settling federal regulators' New York litigation over mortgage-backed securities for an unknown amount.

In exchange for the payment, the Federal Housing Finance Agency and the Federal Deposit Insurance Corp. will drop their claims alleging the Detroit automobile and home lender made misstatements regarding its mortgage-backed securities, according to Ally.

The deal also stipulates that federal authorities will no longer be able...
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