(Bloomberg) -- The U.S. Department of Justice says HSBC will pay $765 million to settle claims related to its packaging, securitization, issuance, marketing and sale of residential mortgage-backed securities between 2005 and 2007.
- The United States alleged that HSBC had a due diligence process for reviewing the loans HSBC planned to securitize as RMBS, but as early as 2005, an HSBC credit risk manager expressed concerns with HSBC's due diligence process.
- “HSBC made choices that hurt people and abused their trust,” said Bob Troyer, United States Attorney for the District of Colorado. “HSBC chose to use a due diligence process it knew from the start didn't work. It chose to put lots of defective mortgages into its deals."
- HSBC disputes and does not admit the allegations.
To contact the reporter on this story: Yueqi Yang in New York at yyang492@bloomberg.net
To contact the editor responsible for this story: Chakradhar Adusumilli at cadusumilli@bloomberg.net
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