Summary Box: Charles Schwab settles suit over fund’s mortgage-backed securities buys for $200M
By APTuesday, April 20, 2010
Summary Box: Schwab settles fund suit for $200M
SETTLEMENT: Charles Schwab said it will pay $200 million to settle a class-action lawsuit that claimed investors were misled about the safety of mortgage-backed securities. The deal must be approved by a federal court.
TOXIC ASSETS: The securities the YieldPlus bond fund held rapidly lost value in 2008 as the mortgage market melted down, causing the fund to deflate.
ONGOING PROBES: Schwab reached the deal with investors, but the SEC and FINRA are still investigating the fund’s collapse.
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