RBS Financial Products Inc., of Stamford, Conn., has agreed to pay a $42 million settlement to end an investigation by the Nevada attorney general’s office of its role in buying and securitizing subprime mortgages.
Attorney General Catherine Cortez Masto said the money will be used for payments to affected borrowers, as well as mortgage fraud enforcement and foreclosure prevention programs.
“The payment from RBS will alleviate some of the injury to the Silver State and its residents,” Masto said. “The changes to its securitization process should help make sure that we do not go down this road again.”
Masto said the two-year investigation focused on misrepresentations by lenders to Nevada consumers who took subprime loans and adjustable rate mortgages that were bought and securitized by RBS between 2004 and 2007.
Under the settlement announced late Wednesday, RBS neither admits nor denies wrongdoing.
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