Authorization

Deutsche Bank, US Department of Justice sign $7.2 bn settlement of toxic mortgages issue

Deutsche Bank, US Department of Justice sign $7.2 bn settlement of toxic mortgages issueDeutsche Bank finalised a $7.2 billion settlement with the U.S. Department of Justice over its sale of toxic mortgage securities in the run-up to the 2008 financial crisis, the government agency said on Tuesday, according to Reuters.

The Justice Department reached $46 billion in settlements with U.S. banks over the shoddy securities that contributed to the U.S. housing market collapse and financial crisis before turning to Deutsche and other European banks.

"Deutsche Bank did not merely mislead investors: it contributed directly to an international financial crisis," Attorney General Loretta Lynch said in the statement. In May 2006, Deutsche Bank, among others, "tolerate[d] misrepresentation" from originators who accepted blacked out pay stubs to state that borrowers had higher incomes. Deutsche Bank also knew appraisals were inflated, and concealed second liens on properties.

John Cryan, Deutsche's chief executive, said that the bank's conduct between 2005 and 2007 fell short of standards and was "unacceptable." He said the bank had exited many of the underlying activities and improved standards.

As part of its deal, Deutsche Bank will pay a civil monetary penalty of $3.1 billion and provide $4.1 billion in consumer relief to homeowners, borrowers and communities harmed by its practices.

The bank also agreed to a statement of facts that describes how it made false and misleading representations to investors about the loans underlying billions of dollars worth of mortgage securities issued by the bank in 2006 and 2007.
.
See also:
Leave a comment
News
  • Latest
  • Read
  • Commented
Calendar Content
«    Апрель 2021    »
ПнВтСрЧтПтСбВс
 1234
567891011
12131415161718
19202122232425
2627282930