A suit was filed against the Credit Suisse Group AG in New York for USD359 million worth of residential mortgage-backed securities. The complainant is an entity whose main business is the management of distressed debt.
The suit was filed by Royal Park Investments SA/NV at the Manhattan state Supreme Court yesterday. It alleged that Credit Suisse, the second largest bank of Switzerland, of making false and misleading statements in its documentation used in the marketing of the said securities. The sales were done between 2005 and 2007, as stipulated int he complaint.
Royal Park said in the pleadings filed in court, "The offered documents further failed to disclose that at the same time defendants were offering the certificates for sale to plaintiff, they were privately betting that similar certificates would soon default at significant rates. Defendants used these offering documents to defraud plaintiff and its assignors into purchasing supposedly 'investment grade' certificates at falsely inflated prices."
Royal Park had also filed suits against other banks on the same residential mortgage backed securities. These banks include Bank of America Corp and Deutsche Bank AG. The firm was established back in 2009 by Fortis, the Belgian bank and BNP Paribas SA to manage distressed debt securities.
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