From WSJ:
New York’s top prosecutor filed a civil complaint against J.P. Morgan Chase Co., alleging widespread fraud in the sale of mortgage-backed securities in the run-up to the financial crisis.
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The allegations relate to billions of dollars of subprime securities issued by Bear Stearns Cos. before the troubled firm, now owned by J.P.Morgan, collapsed in 2008. The suit alleges that losses on residential-mortgage securities issued by Bear Stearns in 2006 and 2007 alone were “astounding,” totaling $22.5 billion, or more than a quarter of the original principal balance. The action asks that the company be made to pay an undisclosed amount of damages “caused, directly or indirectly, by the fraudulent and deceptive acts.”
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