UBS pays $1.43 bln to settle US mortgage claims as industry-wide probe concludes

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UBS to pay US $1.43 bln for alleged fraud over residential mortgage-backed securities

agreed to pay $1.435 billion to settle U.S. charges that the Swiss lender misled investors into buying troubled mortgage securities, concluding an industrywide probe into a root cause of the 2008 global financial crisis.

Many of these securities carried triple-A ratings despite being backed by subprime and other risky mortgages, and investors suffered enormous losses as borrowers went into default and underwriting flaws became apparent., which had bought mortgage specialist Countrywide Financial six years earlier. The bank had rejected a proposal that it pay nearly $2 billion to settle, a person familiar with the matter said at the time.In a press release, UBS said it previously set aside reserves to cover the $1.43 billion payout. Monday's settlement should result in the lawsuit's dismissal.

 

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