New York Attorney General Eric Schneiderman has filed a lawsuit against JPMorgan Chase for fraud over faulty mortgage-backed securities packaged and sold by the former Bear Stearns.
It was the first action to come out of a working group created by President Barack Obama to go after alleged wrongdoing in the financial crisis, Reuters reported.
JPMorgan, which bought one-time rival Bear Stearns for $2 a share in March 2008, said in a statement it intended to contest the allegations.
The lawsuit alleged a "systematic abandonment of underwriting guidelines" in the selling of home loans that went into securities peddled by Bear Stearns.
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