It's All Over People, Lehman To Settle MBS Suit For Half A Cent On The Dollar

Lehman Brothers

Pending court approval, Lehman Brothers Holdings will pay out $40 million to investor groups to settle damage claims totaling $7.7 billion, reports Reuters.

This will bring legal closure, however paltry, to Lehman’s toxic subprime mortgage bundling that nearly brought the global financial system to its knees in 2008.

Of course, a raft of other banks face similar claims. Goldman Sachs is looking at $15.8 billion in MBS-related claims (Reuters). In total, the FHFA is suing banks for $100 billion.

This chapter of the Lehman saga ends not with a bang, but with a whimper. Reuters quotes Steven Toll, an attorney representing investors: “[$40 million] is modest given the potential damages in the case, but under the circumstances it is a good result. The problem is there was just no money to get.”

Next up for what remains of Lehman: bankruptcy reorganization. A hearing on the matter is scheduled for December 6th, reports Reuters.

Don’t miss: Someone Paid $33,000 For The Worthless First Share Ever Issued By Lehman Brothers >>

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