UBS To Pay $300-M To Resolve U.S. Mortgage Securities Cases

UBS said it will pay $300 million to settle outstanding obligations related to the misselling of mortgage-linked investments by Credit Suisse in the U.S., John Revill reported for Reuters.

The collapse in mortgage payments reduced the value of the assets, resulting in massive investor losses.

On August 1, Credit Suisse Securities entered into an agreement with the U.S. Department of Justice to resolve all of Credit Suisse's outstanding consumer relief obligations under a 2017 settlement involving its residential mortgage-backed securities (RMBS) business.

Under the original 2017 agreement, Credit Suisse agreed to pay $5.7 billion to settle with U.S. authorities over claims it misled investors about the quality of RMBS sold in the lead-up to the 2008 financial crisis.

The collapse in mortgage payments reduced the value of the assets, resulting in massive investor losses.

"With this agreement, UBS has resolved another of Credit Suisse's legacy issues, in line with its intention to resolve legacy matters at pace in a fair and balanced way, and in the best interest of all its stakeholders," UBS said.

Credit Suisse previously agreed to pay $495 million in 2022 to settle a case brought by the New Jersey Attorney General, which alleged the bank had “misled investors and engaged in fraud or deceit in connection with the offer and sale of RMBS.”