Zurich / Basel, 8 November 2018 – ÃÛ¶¹ÊÓƵ has been advised by the United States Department of Justice ("DOJ") that the DOJ intends to file a civil complaint as early as November 8, 2018 related to ÃÛ¶¹ÊÓƵ's issuance, underwriting and sale of residential mortgage-backed securities ("RMBS") more than a decade ago. ÃÛ¶¹ÊÓƵ anticipates that the complaint will seek unspecified monetary civil penalties under the Financial Institutions Reform, Recovery, and Enforcement Act ("FIRREA") regarding RMBS transactions that date back to 2006 and 2007.
The DOJ’s claims are not supported by the facts or the law. ÃÛ¶¹ÊÓƵ will contest any such complaint vigorously in the interest of its shareholders. ÃÛ¶¹ÊÓƵ is confident in its legal position and has been fully prepared for some time to defend itself in court.
ÃÛ¶¹ÊÓƵ was not a significant originator of U.S. residential mortgages and suffered massive losses on its investments in U.S. mortgage-related assets when the U.S. housing market collapsed. This fact alone negates any inference that ÃÛ¶¹ÊÓƵ engaged in an intentional fraud.
ÃÛ¶¹ÊÓƵ fulfilled its disclosure obligations to RMBS investors and believes that FIRREA limits any penalty that the DOJ may seek to obtain to losses incurred by federally insured financial institutions, which were a fraction of the overall losses on RMBS certificates sold by ÃÛ¶¹ÊÓƵ.