Pimco sues Citi over mortgage debt losses
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PACIFIC Investment Management Co and other investors have sued Citigroup Inc over the bank's alleged failure to properly monitor toxic securities backed by more than US$13.8 billion of mortgage loans, resulting in US$2.3 billion of losses.
According to a complaint filed on Tuesday in a New York state court in Manhattan, Citigroup breached its duties as trustee for the 25 private-label trusts dating from 2004 to 2007 by ignoring "pervasive and systemic deficiencies" in how the underlying loans were underwritten or being serviced.
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