I was wondering how long this was going to take:
May 13 (Bloomberg) -- Bank of America Corp., JPMorgan Chase & Co., UBS AG and 15 more of the world’s largest financial companies sued MBIA Inc., saying the biggest bond insurer’s split of its guarantee business illegally cut their odds of getting paid on policies.
I said more than two years ago that this mess was going to turn into the lawyers full employment act.
It looks like we're finally getting started; I had been wondering when people were going to start suing over all the blatant and outrageous acts of the previous ten years.
There's plenty to go around. This is allegedly about MBIA (NYSE:MBI) restructuring and effectively diluting the "reachable assets" should they be unable to pay claims on their bond insurance. MBIA, for its part, has already sued over allegedly-fraudulent representations in some of the deals they wrote coverage on.
This is just getting started folks. There is more fraud in all of this mess, as I have documented and written about for the last two years, than every lawyer could possibly bring suit over if they worked 20 hour days for the next 20 years.
From homeowners who lied on applications to firms that sold the loans to aggregators to banks that packaged this crap up to those who were syndicating it and perhaps the ratings agencies and insurers as well, there's plenty to go around.
I look at this as incredibly positive in that if the government will not step in and stomp on The Bezzle, maybe the potential recovery from suing some of these fraudsters to Mars will be sufficient incentive for people to take on the issue themselves.
Disclosure: No positions on bond insurers (MBIA, et.al.)