Hsbc Pays Out £1bn to Settle Us Sub-prime Lender Fraud Claim
by Szu Ping Chan
HSBC has agreed to pay more than £1bn to settle a securities fraud class action that stemmed from the bank’s takeover of a US sub-prime lender more than a decade ago.
The 2002 lawsuit alleged that Household International and a number of the company’s executives made false and misleading statements that inflated the company’s share price.
Household International was also alleged to have hidden the quality of its loan portfolio.
HSBC bought the company in 2003, and the division is now known as HSBC Finance.