Another settlement has been reached by the Royal Bank of Scotland over its handling of the sale of residential mortgage-backed securities. RBS has so far paid more than $13 billion in such costs.
The Edinburgh, United Kingdom-based financial institution has agreed to settle alleged misconduct in the marketing and sale of risky RMBS prior to the 2008 financial crisis.
Recipients of the settlement funds will be the Teachers Retirement System of the State of Illinois, the State Universities Retirement System of Illinois, and the Illinois State Board of Investment.
Announcing the agreement Tuesday was Illinois Attorney General Lisa Madigan, who claims she has “recovered over $475 million for Illinois pension systems and residents as a result of fraudulent conduct in the mortgage-backed securities market.”
Madigan said the settlement resulted from an investigation conducted by her office over RBS’ alleged
failure to disclose the true risk of RMBS investments.
The $20 million RBS is paying for the Illinois agreement is a drop in the bucket compared to its overall payouts.
A review of the cases previously covered by Mortgage Daily reflected more than $13.5 billion in RMBS settlements.
