P. 1
DEXIA Complaint

DEXIA Complaint

Ratings: (0)|Views: 1,692|Likes:
Published by Foreclosure Fraud
4closureFraud.org
4closureFraud.org

More info:

Categories:Types, Research, Law
Published by: Foreclosure Fraud on Jan 20, 2012
Copyright:Attribution Non-commercial

Availability:

Read on Scribd mobile: iPhone, iPad and Android.
download as PDF, TXT or read online from Scribd
See more
See less

01/21/2012

pdf

text

original

 
SUPREME COURT OF THE STATE OF NEW YORKCOUNTY OF NEW YORK
DEXIA SA/NV; DEXIA HOLDINGS, INC.;FSA ASSET MANAGEMENT LLC; DEXIACRÉDIT LOCAL SA,Plaintiffs,v.BEAR STEARNS & CO. INC., THE BEARSTEARNS COMPANIES, INC., BEARSTEARNS ASSET BACKED SECURITIES ILLC, EMC MORTGAGE LLC (f/k/a EMCMORTGAGE CORPORATION),STRUCTURED ASSET MORTGAGEINVESTMENTS II INC., J.P. MORGANACCEPTANCE CORPORATION I, J.P.MORGAN MORTGAGE ACQUISITIONCORPORATION., J.P. MORGANSECURITIES LLC (f/k/a J.P. MORGANSECURITIES INC.), WAMU ASSETACCEPTANCE CORP., WAMU CAPITALCORP., WASHINGTON MUTUALMORTGAGE SECURITIES CORP., LONGBEACH SECURITIES CORP., JPMORGANCHASE & CO., and JPMORGAN CHASEBANK, N.A.,Defendants.Index No.
COMPLAINTJURY TRIAL DEMANDED
FILED: NEW YORK COUNTY CLERK 01/19/2012
INDEX NO. 650180/2012NYSCEF DOC. NO. 2RECEIVED NYSCEF: 01/19/2012
 
i
TABLE OF CONTENTS
I.
 
PRELIMINARY STATEMENT ............................................................................................ 2
 
II.
 
JURISDICTION AND VENUE ............................................................................................. 7
 
III.
 
THE PARTIES........................................................................................................................ 8
 
A.
 
Plaintiffs ...................................................................................................................... 8
 
B.
 
Defendants .................................................................................................................. 9
 
IV.
 
BACKGROUND FACTS AND NATURE OF THE FRAUD............................................. 15
 
A.
 
The Securitization Process ........................................................................................ 15
 
B.
 
Defendants’ Unique and Non-Public Knowledge About The SecuritizedMortgages ................................................................................................................. 23
 
1.
 
Defendants’ Control and Unique Knowledge of the Loan Originators ........ 23
 
2.
 
Defendants’ Control and Unique Knowledge of the Loan PoolsBacking the RMBS ....................................................................................... 26
 
C.
 
Defendants Fraudulently Included Poor Quality Loans in the Securitizations ......... 29
 
1.
 
Bear Stearns .................................................................................................. 29
 
2.
 
Washington Mutual ....................................................................................... 40
 
3.
 
JPMorgan ...................................................................................................... 55
 
D.
 
Defendants Manipulated the RMBS Credit Ratings ................................................. 63
 
1.
 
Defendants Knowingly Supplied False Information to the RatingAgencies ........................................................................................................ 63
 
2.
 
Defendants Exerted Improper Pressure over the Rating Agencies ............... 65
 
3.
 
The RMBS Have All Been Downgraded to Junk ......................................... 68
 
V.
 
DEFENDANTS’ FALSE AND MISLEADING STATEMENTS ....................................... 72
 
A.
 
False and Misleading Statements Concerning Loan Origination andUnderwriting Standards ............................................................................................ 73
 
 
iiB.
 
False and Misleading Statements Concerning Defendants’ Loan Selectionand Due Diligence Practices ..................................................................................... 76
 
C.
 
Defendants’ False and Misleading Statements Regarding the Risk of Default ........ 79
 
1.
 
Defendants’ False and Misleading Statements Concerning BorrowerCredit Quality................................................................................................ 79
 
2.
 
Bear Stearns’ False and Misleading Statements Concerning EarlyPayment Defaults .......................................................................................... 81
 
D.
 
Defendants’ False and Misleading Statements Concerning the Value of theMortgage Collateral .................................................................................................. 82
 
E.
 
Defendants’ False and Misleading Statements Concerning the RMBS CreditRatings ...................................................................................................................... 84
 
VI.
 
PLAINTIFFS REASONABLY RELIED ON DEFENDANTS’REPRESENTATIONS ......................................................................................................... 85
 
VII. ADDITIONAL ALLEGATIONS DEMONSTRATING SCIENTER ................................. 89
 
A.
 
Defendants Are Securitization Experts Who Consciously Included PoorQuality Loans in the Securitizations ......................................................................... 90
 
B.
 
Numerous Confidential Witnesses Have Independently Confirmed thatDefendants Were Deliberately Securitizing Poor Quality Loans ............................. 91
 
C.
 
Defendants Profited Enormously from their Fraud .................................................. 93
 
D.
 
Bear Stearns Deliberately Purged Its Due Diligence Records .................................. 93
 
VIII.
 
PLAINTIFFS SUFFERED LOSSES BECAUSE OF DEFENDANTS’FRAUDULENT CONDUCT ................................................................................................ 94
 
IX.
 
CAUSES OF ACTION ......................................................................................................... 95
 
PRAYER FOR RELIEF ................................................................................................................. 118
 
JURY DEMAND ............................................................................................................................ 118
 

Activity (7)

You've already reviewed this. Edit your review.
1 hundred reads
1 thousand reads
acederbaum liked this
Adhikarilal Sadh liked this
monbarrs liked this
Mary Ng liked this

You're Reading a Free Preview

Download
scribd
/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->