We ALL know how this too shall end…
The state of California sued Morgan Stanley on Friday, accusing the bank of hiding the risks of complex mortgage debt and other securities it sold, causing big losses for the state’s public pension funds, CalPERS and CalSTRS.
Kamala Harris, the state attorney general, said Morgan Stanley concealed or downplayed the risks of toxic residential mortgage-backed securities and “structured investment vehicles” it marketed from 2004 to 2007, sometimes encouraging credit rating agencies to award unjustifiably high ratings.
She said the bank’s conduct reflected “a culture of greed and deception” that fueled the 2008 financial crisis and caused the California Public Employees’ Retirement System and California State Teachers Retirement System to lose hundreds of millions of dollars.
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