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Morgan Stanley will pay the state and its residents more than $100 million as part of a settlement negotiated by Attorney General Martha Coakley related to financing for subprime mortgages.
As part of the agreement, the New York based bank will pay $58 million to more than 1,000 Bay State homeowners who were impacted by the securitization of subprime loans. Morgan Stanley will also pay $23 million to the state's pension fund to cover losses and will give $19.5 million to the state's general fund.
The suit Coakley brought against Morgan Stanley alleges that the company provided money for retail loan outlets to target low-income borrowers and "lure" them into accepting loans they could not afford.
The settlement is the latest Coakley has negotiated for the state now totaling $130 million for investors and borrowers impacting more than 15,000 homeowners.
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Worcester Business Journal presents a special commemorative edition celebrating the 300th anniversary of the city of Worcester. This landmark publication covers the city and region’s rich history of growth and innovation.
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