CIFG Sues Bank of America Over RMBS Insurance Policies

Orrick - Finance 20/20
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On November 20, CIFG sued Bank of America in Supreme Court for the State of New York concerning five financial guaranty policies issued in connection with two structured transactions backed by 22 RMBS. CIFG alleges that Bank of America knowingly repackaged securities backed by poor quality mortgage loans into two new securitizations. CIFG alleges that it was induced to insure the securitizations by misrepresentations about the quality of the underlying mortgage loans. CIFG alleges fraudulent inducement, misrepresentation in violation of New York Insurance law, negligent misrepresentation, and breach of contract. CIFG seeks payment of past, current, and future claims or rescissionary damages, reimbursement for its losses, and punitive damages. Complaint.

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