TRENTON, N.J. (AP) — The state of New Jersey is accusing Credit Suisse Securities and two affiliates of misrepresenting the risks involved in the sale of more than $10 billion in residential mortgage-backed securities.
In a lawsuit filed Wednesday, the state said Credit Suisse did not disclose to investors that underwriting guidelines had been abandoned in the sales.
The suit says investors were also not told that numerous loan originators had poor track records and that some had even been suspended from doing business with Credit Suisse.
New York State filed a similar suit last year.
New York-based Credit Suisse Securities is a subsidiary of Zurich-based Credit Suisse and operates as an investment bank in the United States.
Credit Suisse spokesman Drew Benson says the complaint is without merit and uses inaccurate and exaggerated figures.