WASHINGTON (8/26/14)--A $3.15 billion settlement was reached between the Federal Housing Finance Agency (FHFA) and Goldman Sachs in a lawsuit involving private-label mortgage-backed securities (PLS). The PLS were purchased by Fannie Mae and Freddie Mac between 2005 and 2007, and the FHFA alleged Goldman Sachs violated federal and state securities laws.
Under the terms of the settlement, Goldman Sachs will pay approximately $2.15 billion to Freddie Mac and approximately $1 billion to Fannie Mae.
According to an FHFA, the settlement effectively makes Fannie Mae and Freddie Mac whole on their investments in the securities at issue. As part of the settlement, FHFA, Fannie Mae and Freddie Mac will release certain claims against Goldman Sachs & Co. related to the securities involved.
The settlement also resolves claims that involved a Goldman Sachs security in FHFA v. Ally Financial Inc., et al. FHFA previously settled claims against Ally Financial Inc.
This is the 16th settlement reached in the 18 PLS lawsuits filed by the FHFA in 2011. Three cases remain outstanding.
Use the resource link below to access the full settlement.