Barclays sues Bear Stearns over sub-prime
Barclays sues US investment bank over dispute involving hedge fund
The fall-out of the sub-prime crisis turned ugly for Barclays this week as it
emerged that the UK bank was to sue US investment bank Bear Stearns.
According to the Guardian the case relates to the loss of hundreds
of millions of pounds in a failed hedge fund.
The lawsuit, filed in New York, accuses Bear Stearns of deliberately
concealing the fund’s losses. The fund eventually sucked up $400m (£200m) of
Barclays said the fund’s failure was ‘one of the most high-profile and
shocking hedge fund failures in the last decade’. Barclays claims in the days
before the fund had to be rescued, Bear Stearns executives covered up the slump
Bear Stearns defended itself against the allegations.
Barclays has already taken a $1.7bn write-down on its sub-prime assets.