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CDO Fraud Probes to Be 2011 Priority

U.S. criminal investigators will step up probes into possible fraud involving collateralized debt obligations and credit default swaps, a top federal prosecutor in New York said. Christopher Garcia, chief of the Securities and Commodities Fraud Task Force in the U.S. Attorney’s Office in Manhattan, told white-collar criminal-defense lawyers at a conference today that his office […]

UBS re-Files Highland Capital CDO Case

UBS is re-filing its lawsuit against distressed hedge fund firm Highland Capital claiming the firm did the Swiss bank out of $686 million in a CDO deal. The new case, filed Monday in New York State court, is reminiscent of the SEC’s case against Goldman Sachs over a CDO deal gone bad. However, in the […]

UBS Sues Highland Capital Over CDO Losses

UBS AG, Switzerland’s biggest bank, sued Highland Capital Management LP in New York, claiming losses of at least $745 million in a failed collateralized debt obligation transaction. Highland Capital, the investment firm founded by James Dondero and Mark Okada, failed to fulfill terms of the deal reached in April 2007, UBS said in a breach-of-contract […]

Toxic CDOs Reincarnated as Re-Remics

They’re baaaaack. Those toxic and worthless colllateralized debt obligations (CDOs) that helped drive banks $400 billion into the red are finding new buyers under a different name: Re-Remics. Due to the global credit crunch, CDOs sales fell from $227 billion in 2007 to $1 billion this year so Goldman Sachs, J.P. Morgan and at least […]

Valuations In Spotlight As Funds Halt Redemptions

Fund managers and banks are under scrutiny for their methods in valuing illiquid securities, after some funds admitted they’re having trouble putting a price on complex debt instruments backed by residential mortgages and corporate loans. Units of French bank BNP Paribas SA (BNPQY) and insurer AXA SA (AXA) have suspended redemptions on some of their […]