Credit Suisse Group AG
) has applied for a dismissal of a lawsuit filed by New York
Attorney General, Eric Schneiderman. The litigation accused the
Zurich-based bank of misleading the investors regarding certain
mortgage-backed securities that led to $11.2 billion in losses.
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However, Credit Suisse declared that the Attorney General delayed
in filing the complaint. Further, the bank alleged that the
plaintiff did not precisely indicate its offense.
Earlier, in Nov 2012, the Attorney General accused the Swiss bank
of misrepresentation of the quality of loans associated with the
mortgage-backed securities, which were sponsored and underwritten
by the bank in 2006 and 2007. However, Credit Suisse claimed that
the charge was the same as other lawsuits filed previously.
Notably, in the same month, Credit Suisse made a settlement worth
$120 million with the U.S. Securities and Exchange Commission
(SEC) and the bank claimed that the present lawsuit repeated some
of the claims addressed in that. Further, the bank claimed that
the investors were well aware of the risky nature of the
Credit Suisse also claimed that the complaint was debarred by a
three-year statute of limitations and by the National Securities
Markets Improvement Act of 1996, which prevents state securities
laws. However, the Attorney General disputed that the statute
spans for six years.
Schneiderman is co-chair of a state-federal task force including
the SEC. The SEC is probing transgression and misrepresentations
by many U.S. banking majors like
JPMorgan Chase & Co.
Wells Fargo & Company
) in the sale of mortgage-backed securities that led to the
Credit Suisse currently carries a Zacks Rank #5 (Strong Sell).