BNY Mellon Failed As Trustee Of $2B In MBS, FDIC Suit Says

Law360, Los Angeles (August 19, 2015, 9:31 PM EDT) -- The Federal Deposit Insurance Corp. lobbed a suit at Bank of New York Mellon Corp. on Wednesday in New York federal court, accusing the bank of failing as trustee of about $2 billion worth of residential mortgage-backed securities.

Acting on the behalf of defunct Guaranty Bank, the U.S. banking regulator said BNY Mellon was paid to watch over the 12 trusts sponsored by Countrywide Home Loans and EMC Mortgage Corp., a unit of doomed investment bank Bear Stearns.

"BNY Mellon, however, shirked its duty to exercise its powers to protect plaintiff and instead attempted to shorn itself of the responsibilities that...

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