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March 10, 2014

Credit Suisse Documents Point to Mortgage Lapses

“The email from a Credit Suisse executive was blunt: The bank seemed to be pushing through risky home mortgages from questionable applicants.

“One borrower, the executive wrote, appeared to be a gas station attendant who was living with his mother while claiming to make $93,000 a year. Another was a former sales clerk at Nordstrom who was said to be making $110,000 a year.

“A different email, from another Credit Suisse executive in June 2007, went further: “Our diligence process is such a joke.”

“The emails are part of a newly released trove of internal communications and documents, mostly from 2006 and 2007, that paint a troubling picture of how Credit Suisse, a major player in the American mortgage market, operated as the housing bubble inflated. The documents, filed in Massachusetts state court as part of an investor lawsuit, suggest that top officials at the bank routinely pressed subordinates to override due diligence standards and accept questionable loans that were subsequently bundled into mortgage investments.”

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Read full NY Times article here.

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