FEDERAL COURT FINDS AGAINST LEHMAN BROTHERS
FEDERAL COURT FINDS AGAINST LEHMAN BROTHERS
They were conservative investors and the products which were sold to them by Lehman were simply not suitable,” said Amanda Banton.
In a case that should launch fresh legal action in Australia and could have global implications, a group of local charities, churches and councils has won a Federal Court victory against failed US investment bank Lehman Brothers.
Seventy-two entities banded together in a class action to sue Lehman Brothers for $248 million, claiming the bank breached contracts and fiduciary duties and engaged in misleading and negligent conduct in selling investments from Grange Securities, purchased by Lehman in Australia in 2007.
“Grange is liable to compensate the councils for their losses incurred as a result of their investments,” Justice Rares said in his findings delivered late on Friday.
The claimants all purchased subprime mortgage-related derivatives or collateralised-debt obligations (CDOs), which were sold in Australia as federation notes, rated AAA.
Around $1 billion of these federation notes were sold in Australia, but they were rendered worthless by the meltdown of the US housing sector in 2007. Another $4 billion in CDOs were sold to Australian local governments and the not-for-profit sector by other financial institutions.......
http://www.iandtnews.com.au/news/federal-court-finds-against-lehman...
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Permalink Reply by Patriot Pete on
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If they're lucky, 30c in the dollar is all they'll receive I hear
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Not sure they'll push their luck that far ... I just wish our local governments would do what they are supposed to do, for one thing they could spend our taxes on the goat tracks they call roads down here .... instead of gambling the money away on lost causes. Waste not want not! but how could we expect any different though when the sheeple vote in one major party or the other into these local governments, common sense and governing for constituents is out the window - a foregone conclusion!
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