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Monday, July 22, 2024 | Back issues
Courthouse News Service Courthouse News Service

SEC Settles With RBS for $154 Million

BRIDGEPORT, Conn. (CN) - The Royal Bank of Scotland will pay $153.7 million to settle SEC charges that it misled investors in a $2.2 billion mortgage-backed securities offering in 2007.

"RBS misled investors about the quality and safety of their investments by claiming that the subprime loans backing the multi-billion dollar offering were 'generally' in compliance with the lender's underwriting guidelines," the SEC said in its settled federal complaint.

"In fact, RBS knew or should have known at the time that almost 30 percent of the loans backing the offering deviated so much from the lender's underwriting guidelines that they should have been kicked out of the offering entirely."

The bank agreed to disgorge $80.3 million, plus $25.2 million in interest, and pay a civil fine of $48.2 million, the SEC said in a statement.

As is customary with the SEC, the bank did not have to admit that it did anything wrong.

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