Citigroup Investors File New RMBS Suit, Claim $2.3B In Losses

By Kurt Orzeck (November 25, 2015, 9:48 PM EST) -- Pacific Investment Management Co. and other investors on Tuesday filed the latest suit accusing Citibank NA of ignoring widespread problems with toxic residential mortgage-backed securities, claiming $2.3 billion in losses in a proposed class action in New York state court.

The suit alleges that Citibank, in an effort to protect its own business interests, turned a blind eye to pervasive problems in how the underlying loans — allegedly worth more than $13.8 billion — were written or serviced. Plaintiffs alleged that the bank feared jeopardizing its relationship with loan servicers like Washington Mutual, Lehman Brothers Holdings Inc. and Wells Fargo Bank....

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