Countrywide Financial Corp. to Pay $600 Million in Subprime Suit

May 10, 2010 Updated: May 10, 2010

Countrywide Financial Corporation Securities will have to pay $600 million in a settlement, announced New York State Comptroller Thomas DiNapoli on Friday. The New York Common Retirement Fund and five other pension funds sued Countrywide.

The lawsuit “helps repair the damage Countrywide has done to our fund,” said DiNapoli in a statement. KPMG, an accounting firm under Countrywide, has to pay $24 million in the lawsuit. The settlement is the 13th largest of its kind in history.

Countrywide allegedly violated securities laws in subprime mortgage. DiNapoli said that Countrywide didn't disclose certain policies to their clients when they gave out loans. He asserted that Countrywide was cheating state workers out of their pensions and the money that they deserve.

The Common Retirement Fund has a total of $129.4 billion in public pensions.