Va. attorney general sues major banks for $1.15B

[unhappycamper]

http://hamptonroads.com/2014/09/va-attorney-general-sues-major-banks-115b

Va. attorney general sues major banks for $1.15B
By Danielle Douglas and Laura Vozzella
The Washington Post
© September 17, 2014

Virginia Attorney General Mark Herring on Tuesday announced a $1.15 billion lawsuit against 13 of the nation’s biggest banks, accusing them of misleading a state retirement fund about the quality of bonds made up of residential mortgages.

The lawsuit, unsealed in Richmond Circuit Court, is the largest financial fraud action ever brought by the state of Virginia. It mirrors legal actions being taken across the country by attorneys general seeking redress for state pension funds that were ravaged by the financial crisis.

“These securities were financial time bombs that a lot of banks tried to get off their books as soon as possible,” Herring said at a news conference. “And some of them provided … investors with information they knew or should have known was false in order to lure them into buying these new investments.”

Herring said the banks – including JPMorgan Chase, Citigroup and Credit Suisse – knowingly packaged faulty home loans into securities they sold to the Virginia Retirement System. The pension fund, which counts 600,000 members on its rolls, purchased 220 residential-mortgage-backed securities starting in 2004. When the financial markets tanked and the value of those bonds took a nose dive, the fund was forced to sell the vast majority of the securities and lost $383 million.

[gwheezie]

1. I'm still waiting

For someone to investigate why Diane Cantor invested state retirement funds in star scientific.