Securities Expert Witness Testifies In Nomura Trial

Securities expert witness Peter Rubinstein testified in the Nomura trial against the Federal Housing Finance Agency.  Namura Holdings Inc, a global financial services group based in Asia, says the 2007 US housing market is to blame for the financial crisis in 2008 and not the company’s sale of mortgage backed securities.  The Federal Housing Finance Agency has sued 18 financial institutions on behalf of Fannie Mae and Freddie Mac.

The US District Court, Southern District of New York complaint states:

This action arises out of Defendants’ actionable conduct in connection with the offer and sale of certain residential mortgage-backed securities to Fannie Mae and Freddie Mac (collectively, the “Government Sponsored Enterprise s” or “GSEs”).  These securities were sold pursuant to registration statements, including prospectuses and prospectus supplements that formed part of those registration statements, which contained materially false or misleading statements and omissions.  Defendants falsely represented that the underlying mortgage loans complied with certain underwriting guidelines and standards, including representations that significantly overstated the ability of the borrowers to repay their mortgage loans.

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