It was only a matter of time. A few weeks after every money losing firm in the US and the kitchen sink disclosed it would sue Bank of America in an accelerating attempt to salvage something through litigation, the worst case scenario for Brian Moynhian just got real. As of minutes ago, Norway's Government Pension Fund, which is another name for its Sovereign Wealth Fund, has just announced it is suing Bank of America for mortgage fraud. Not only that but it is also going after Countrywide, obviously, but far more importantly, is also suing KPGM, the auditor on the Countrywide transaction, and, drumroll, ole' Agent Orange himself. If US bank analysts were busy quantifying the damages from every bank in the US suing BofA, just wait until the calculation is expanded to included every firm that bought mortgages from Bank of America... ever...in the entire world.
Pension Fund chief Yngve Slyngstad suing mortgage company Country-wide, the owner Bank of America and KPMG in the U.S. for fraud, newspaper Dagens Næringsliv.
Billions are at the game.
The Fund and 14 other large institutional investors meetings the parties to a court in California.
They claim that Countrywide - formerly the largest U.S. lender for residential purposes - held back important information and concealed the extent of credit risk that the company took. The company was one of the largest lending founders of so-called subprime loans, which was a major cause of financial crisis.
Because of the misrepresentation of the company and senior management, bought the oil fund and other investors in Countrywide shares at artificially high prices from March 2004 to March 2008, according to the fund.
Angelo Mozilo and two other former directors sued as well. They should have enriched himself personally by selling shares of "several hundred million dollars" based on information that was not available in the market.
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