A civil suit has been filed against Bear Stearns & Company, now a unit of JPMorgan Chase by New York Attorney General Eric T. Schneiderman, co-chairman of the federal Residential Mortgage-Backed Securities Working Group.
The New York Times reports that Schneiderman’s suit contends that Bear Stearns and it’s lending unit, EMC Mortgage, defrauded investors who purchased mortgage securities packaged by the companies from 2005-2007
Other cases brought by the Securities and Exchanges Commission have targeted specific deals that harmed investors. The Bear Stearns suit contends that practices were institution-wide and affect a large number of deals during the time period.
According to people close to the investigation, Schneiderman’s work on the case dates back to the spring of 2011 when the Attorney General subpoenaed documents from JPMorgan Chase.