Credit Suisse Sued Over Mortgage Loans by Assured Guaranty

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A Credit Suisse Group AG (CSGN) unit was sued by over securitized mortgage loans for which Assured Guaranty Ltd. (AGO) guaranteed payments to investors and that the bond insurer says were riskier than promised.

Credit Suisse’s DLJ Mortgage Capital Inc. misrepresented the quality of loans underlying the mortgage securities, exposing Assured to “hundreds of millions of dollars” in current and future claim payments, Assured units said in a complaint filed yesterday in New York state Supreme Court.
“Assured is exposed to enormous current and future claims under the policies,” they said.

Credit Suisse spokesman Steven Vames said in an e-mailed statement that the company would fight Assured’s attempt to “misuse litigation to sidestep its insurance responsibilities and shift its own exposure to others.” Credit Suisse Securities (USA) LLC is also named as a defendant.

“Assured is a sophisticated multibillion dollar insurance company that received full disclosure about the securities they chose to insure,” he said. “Now that investors have suffered losses, Assured has chosen to file a lawsuit to evade its insurance obligations.”

http://www.bloomberg.com/news/2011-10-17/assured-guaranty-sues-credit-suisse-dlj-mortgage-in-new-york.html