ZURICH (Reuters) -UBS on Monday said it will pay $300 million to settle outstanding obligations related to the misselling of mortgage-linked investments by Credit Suisse in the United States.
On August 1, Credit Suisse Securities entered into an agreement with the U.S. Department of Justice to resolve all of Credit Suisse’s outstanding consumer relief obligations under the 2017 settlement for its residential mortgage-backed securities (RMBS) business, the bank said.
Under the 2017 agreement, Credit Suisse agreed to pay $5.7 billion to settle with U.S authorities over claims it misled investors in residential mortgage-backed securities it sold in the run-up to the 2008 financial crisis.
The decline in mortgage payments reduced the value of the assets, leading to huge losses for investors.
“With this agreement, UBS has resolved another of Credit Suisse’s legacy issues, in line with its intention to resolve legacy matters at pace in a fair and balanced way, and in the best interest of all its stakeholders,” UBS said.
Credit Suisse agreed to pay $495 million in 2022 to settle one case brought by the New Jersey Attorney General that alleged the bank had “misled investors and engaged in fraud or deceit in connection with the offer and sale of RMBS.”
(Reporting by John Revill, Editing by Miranda Murray)
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