Mortgage Foreclosure & Refinance Resource

Today Bernstein Litowitz Berger & Grossmann LLP announced the establishment of a new practice group in the wake of the collapse of the subprime mortgage industry and the continuing revelations of misconduct by mortgage lenders, bankers and rating agencies.

The newly formed Subprime Litigation Practice Group will help ensure that the rights of institutional and individual investors, as well as consumers, are fully protected and will advise clients on potential claims against all participants, including lenders, investment banks and ratings agencies. “With the recent announcements of major write-downs being taken by leading financial institutions as a result of exposure to subprime mortgage subprime and other mortgage-backed investments, and the revelation that respected institutional investment managers were gambling their clients’ retirement savings on investments in exotic instruments, it has become clear that the collapse of numerous subprime lenders earlier this year marked just the tip of the iceberg,” said BLB&G Partner Gerald Silk.

The Subprime Litigation Practice Group will handle the full range of litigation matters related to the subprime collapse, including claims on behalf of investors in mortgage lenders, companies in related industries, and financial institutions that have concealed their exposure to losses from mortgage-backed securities, and investors in CDOs and other financial instruments tied to mortgage-backed securities. In addition, the Group is investigating the claims of consumers who were harmed by the predatory and discriminatory practices of mortgage lenders.

BLB&G is currently lead counsel in the securities class actions on behalf of investors in subprime lenders New Century Financial Corporation, Accredited Home Lenders Holding Company and Fremont General Corporation. The Firm is also representing institutional investors asserting claims against American Home Mortgage Investment Corporation. As counsel to the Ohio Public Employees Retirement System and the State Teachers Retirement System of Ohio in Ohio Public Employees Retirement System v. Freddie Mac, a lawsuit arising from the Federal Home Loan Mortgage Corporation’s (i.e., “Freddie Mac”) manipulation of earnings through various complex transactions involving the company’s mortgage finance and securitization operations.

The Firm is also prosecuting the first case asserted on behalf of retirees whose retirement savings were improperly — and imprudently — invested in high-risk mortgage-backed securities, in an ERISA class action recently filed against State Street Bank & Trust Company and State Street Global Advisors. BLB&G is also currently advising institutional and high-net-worth investors who invested, directly and indirectly, in mortgage-backed securities such as collateralized debt obligations (”CDOs”).