by Lady Michelle-Jennifer Santos,
Founder & Publisher, Political Strategist, and Strategy/Peace
Negotiator with the UN Security Council Special Envoy to the Arab
Nations
September 7, 2012 (TSR) – The array of lawsuits continues for the
U.S. banks since the financial meltdown as many have figured out
fraudulent activities by these American companies. Many of Germany’s
government-backed “Landesbanks” have suffered major losses as a result
of bets on the U.S. housing market made prior to the financial crisis.
The latest German bank to sue their U.S. counterparts is German
lender IKB Deutsche Industriebank AG, which was rescued after suffering
multibillion-dollar losses on investments in U.S. subprime loans, filed a
lawsuit against The Goldman
Sachs Group Inc. (GS) and Citigroup Inc. (C) in New York state court on
Wednesday for misrepresentation of documents and deception while
selling $210 million in mortgage-backed securities (MBS).Also on Wednesday, Reuters reported that UBS AG (UBS) sued Sealink Funding Ltd. over $158.1 million in MBS.
The lodged complaint, which involve $137 million in securities sold by Citi and $73 million in securities offered by Goldman, represent the latest in a string of complaints IKB has filed against big-name corporations it blames for its staggering losses and subsequent bailouts.
Both German claimants are saying that these U.S. banks issued misleading statements with omissions related to the mortgage-backed securities and concealed risks associated with these securities. IKB and Sealink claim that the documents given to them, which were used for offering the securities, contained fraudulent statements or omissions regarding the risks associated with the investments thereby giving misinterpretation of these investment risks which incurred losses at current levels.
Both IKB and Sealink have filed the lawsuits in the New York State Supreme Court in Manhattan and demand compensation for the damages. However, Goldman, Citi and UBS have refrained from commenting on the issue.
Lawsuits against Goldman Sachs has been piling up. Recently it was also sued by another German lender-Bayerische Landesbank in the Supreme Court over the same issue for $511.9 in fraudulent securities.
Last month, together with another Wall Street giant, Morgan Stanley (MS), was sued by another German lender, HSH Nordbank AG, for the sale of over $524 million and $110 million, respectively, in residential mortgage-backed securities.
There is a steady stream of similar German bank lawsuits, which are also filed in New York State Supreme Court against big-name issuers of mortgage-backed securities, including (but certainly not limited to):
1) February 2012: Germany’s fourth largest bank, DZ Bank AG filed a lawsuit against JPMorgan Chase (JPM), saying that it purchased $85 million in MBS from JPMorgan based on flawed offering materials
2) February 2012: DZ Bank also filed against HSBC (HBC), claiming misrepresentations and omissions in offering materials, on $122 million in MBS purchases.
3) April 2012: German lender HSH Nordbank AG filed against two subsidiaries of Barclays PLC (BCS), claiming Barclays misrepresented the quality of loans underlying $46 million in mortgage-backed securities.
4) April 2012: The Bayerische Landesbank, one of eight German Landesbanks that are primarily owned by German state governments, filed a suit against Deutsche Bank AG (DB), accusing Deutsche Bank of committing fraud while selling $810 million in residential MBS.
Read more>>Germany sues U.S. Banks for fraud, demands money back | The Santos Republic
