Blood In The Water: Investor Bites Back
By Andy Miofsky, Illinois Bankruptcy Attorney on Jul 28, 2007 in Illinois
Raphael Nach filed suit in US District Court in the Northern District of Illinois alleging Moody’s CEO made “false and misleading” statements and assigned “excessively” high ratings to certain subprime mortgage backed bonds, Edvard Pettersson of Bloomberg writes in his column Moody’s Finance Chief Sued by Investor Over Subprime Ratings. This is another of the emerging lawsuits over subprime mortgage defaults and the investors who lost money, a trend predicted by Florida attorney Chip Parker in his blog Suing the Mortgage Industry: Turnabout Is Fair Play.
In mid-July Moody’s downgraded 399 mortgage backed bonds and announced a review of 32 others, affecting approximately $5.2 billion bonds. Pettersson says some bonds fell more than 50 percent without affecting a rating change.
Nach seeks class representation on behalf of similarly situated investors.
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