Citigroup Inc., Wells Fargo & Co. and Bank of America Corp. are facing multiple lawsuits over alleged misstatements or omissions in their underwriting of residential mortgage-backed securities, the companies said Friday in quarterly regulatory filings.
The suits have been filed since June in various state and federal courts, and seek to recoup losses from investments in mortgage-related securities.
B of A said in its filing that it faces suits over more than $375 billion in mortgage-backed securities. Later on Friday it said U.S. District Court in California dismissed a class action filed by the Maine State Retirement System over MBS issued by B of A's Countrywide unit, limiting the subject of the suit's dispute to $31 billion of securities from $352 billion.
Citi said it has been sued by an investor group over misstatements or omissions in its underwriting of mortgage-backed securities. In July, several investors including Cambridge Place Investment Management, Charles Schwab Corp. and the Federal Home Loan banks of Chicago and Indianapolis, filed a suit against Citi and some of its affiliates. Citi wouldn't provide any estimate of losses.
Wells Fargo, a target of the suits by some Federal Home Loan banks, said in its quarterly earnings filing that various class actions have been filed against it — and other banks — "challenging aspects of the foreclosure process." It said it "cannot estimate the possible loss or range of loss" from those legal actions.
Meanwhile, Schwab said it has filed a suit against units of a dozen banks in Superior Court of California in San Francisco, seeking to rescind its purchase of mortgage-backed investments or be paid damages for losses.