Wells Fargo, HSBC Among Banks Sued Over Subprime Securities

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Wells Fargo, HSBC, Bank of New York Mellon and Deutsche Bank were sued by an Irish securities firm that claims the banks failed to protect investors in their role as trustees of securities backed by home loans that defaulted after the 2008 credit crisis.

Phoenix Light SF Ltd. accused the banks, in complaints filed Tuesday in Manhattan federal court, of failing to safeguard the interests of investors as required by their contracts. The securities were sold from 2005 to 2007.

Phoenix Light and related investors sued Deutsche Bank over 21 securitization trusts on which they claimed $183 million in losses. BNY Mellon was sued over 27 offerings for claimed damages of $269 million. Wells Fargo was sued for $237 million in losses on 12 securitizations and HSBC for $170 million on 11 securitizations.

The suits are part of a move by investors to target trustees of mortgage securities over their role in the crisis. Trustees have been sued by the National Credit Union Administration and by other investors, including hedge funds.

Kevin Friedlander, a spokesman for San Francisco-based Wells Fargo, declined to comment on the allegations. Neil Brazil, a spokesman for London-based HSBC, had no immediate comment. Kevin Heine, a spokesman for New York-based BNY Mellon, didn’t immediately respond to a voice mail message seeking comment. Frankfurt-based Deutsche Bank’s media relations department didn’t respond to calls.

The cases are Phoenix Light SF Ltd. v. HSBC Bank USA, 14- cv-10101; Phoenix Light SF Ltd. v. Wells Fargo Bank N.A., 14- cv-10102; Phoenix Light SF Ltd. v. Deutsche Bank National Trust Co., 14-cv-10103; Phoenix Light SF Ltd. v. Bank of New York Mellon Corp., 14-cv-10104; U.S. District Court, Southern District of New York (Manhattan).

Article source: http://www.nationalmortgagenews.com/news/secondary/wells-fargo-hsbc-among-banks-sued-over-subprime-securities-1043463-1.html

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