Subprime and punishment

Legal Risk

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The fallout from the subprime mortgage crisis has started to mushroom. While early attention focused on the multi-billion-dollar writedowns at investment banks, monolines and hedge funds, the consequences are now beginning to be felt more widely. In particular, financial institutions are bracing themselves for a wave of class action lawsuits from disgruntled investors, hit by plunging prices on residential mortgage-backed securities and collateralised debt obligations referenced to subprime l