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Credit Suisse to Pay $885 Million to FHFA

The Federal Housing Finance Agency (FHFA) announced Friday it had settled two separate lawsuits with Credit Suisse alleging violations of federal and state securities laws in connection with private-label mortgage-backed securities (PLS) purchased by Freddie Mac and Fannie Mae during 2005-2007.

As conservator for Freddie Mac and Fannie Mae, the FHFA filed two lawsuits against Credit Suisse, FHFA v. Credit Suisse, et al. as well as FHFA v. Ally Financial Inc., et al. The two groups settled, with Credit Suisse to pay $885 million to the FHFA.

"Under the terms of the agreement, Credit Suisse will pay approximately $234 million to Fannie Mae and approximately $651 million to Freddie Mac and certain claims against Credit Suisse related to the securities involved will be released," according to a release issued by the government agency.

The language of the legal settlement noted, "The Parties agree that this Agreement is the result of a compromise," and that, "This Agreement does not constitute an admission by any of the Credit Suisse Defendants of any liability or wrongdoing whatsoever...”

The agreement between the FHFA and Credit Suisse ends any litigation against the company.

This is the ninth settlement the FHFA has announced in relation to 18 PLS lawsuits the agency filed in 2011.

About Author: Colin Robins

Colin Robins is the online editor for DSNews.com. He holds a Bachelor of Arts from Texas A&M University and a Master of Arts from the University of Texas, Dallas. Additionally, he contributes to the MReport, DS News' sister site.

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