Big bank's $272 million mortgage bond settlement approved

by Ryan Smith02 May 2016
A federal judge has approved Goldman Sachs’ $272 million settlement with investors who claim the bank misled them about the quality of mortgage-backed securities.

U.S. District Court Judge Loretta Praska approved the settlement today in Manhattan, according to a Bloomberg report. The settlement was reached in August.

Goldman Sachs was sued in 2008 by several pension funds, which claimed the bank had given them inaccurate information about the quality of home loans underlying mortgage-backed securities. The value of those securities plummeted during the 2008 financial meltdown.

This isn’t the first time Goldman has had to pay for shoddy securities. In 2014, the bank agreed to buy back nearly $3.2 billion in mortgage-backed securities from Fannie Mae and Freddie Mac in order to settle a suit filed by the Federal Housing Finance Agency, Bloomberg reported.
 

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