Credit Suisse sued over risky US investments

Swiss bank Credit Suisse is one of 17 financial firms being sued for violating United States laws in the sale of residential mortgage-backed securities.

This content was published on September 3, 2011 - 11:22 and agencies

Lawsuits were filed on Friday by the US Federal Housing Finance Agency against the firms for selling Fannie Mae and Freddie Mac billions of dollars of mortgage-backed securities that turned toxic when the housing market collapsed.

Among those targeted by the lawsuits were America’s biggest banks and several European banks.

Credit Suisse was being sued for $14.1 billion (SFr11.1 billion). The total price tag for the securities sold to Fannie and Freddie by the firms named in the lawsuits was $196 billion.


Residential mortgage-backed securities bundled pools of mortgages into complex investments. They collapsed after the property bust and helped fuel the financial crisis

in late 2008.

The Federal Housing Finance Agency filed a similar lawsuit in July against Switzerland’s other big bank UBS, seeking to recoup more than $900 million in losses from mortgage-backed securities.

The US agency oversees Fannie and Freddie, the two agencies that buy mortgages loans and mortgage securities issued by the lenders.

In compliance with the JTI standards

In compliance with the JTI standards

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