NBC-
Goldman Sachs Group Inc. will pay $272 million to settle a lawsuit that claimed the Wall Street bank defrauded investors about the safety of about $6 billion of residential mortgage-backed securities they bought in 2007 and 2008.
The settlement with investors led by the NECA-IBEW Health & Welfare Fund, an electrical workers’ pension fund in Decatur, Illinois, was disclosed in filings with the U.S. District Court in Manhattan on Thursday.
NECA-IBEW accused Goldman of misleading investors about the underwriting of home loans backing the securities, including the quality of appraisals and whether borrowers were capable of repaying their loans. The fund said the securities’ prices collapsed during and after the financial crisis, while their credit ratings fell to low, “triple-C” junk grades from “triple-A.”
[NBC]
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