Hedge Fund Sues Ameriquest Over Subprime Securities

Hedge-fund firm Ellington Management Group LLC has sued Ameriquest Mortgage Co. and other ACC Capital Holdings units because of losses stemming from investments in securities backed by subprime mortgages.

The firm says it ‘largely lost’ a $354 million investment in securities due to misrepresentations about the debt's risk, according to a Bloomberg report. Ellington's complaint accuses Ameriquest of failing to verify borrowers' employment, report past loan delinquencies and accurately state the occupancy status of properties, the report notes.

SOURCE: Bloomberg


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