Three civil rights groups, including the New York Civil Liberties Union, have joined Citibank, Bank of America, Wells Fargo and other major banks in urging the New York Court of Appeals to reverse a ruling dismissing a $5 billion fraud suit over the 2009 breakup of bond insurer MBIA, complaining on the grounds that it was approved without public hearings by the state Insurance Department.
In an amicus brief filed Monday in ABN Amro Bank NV v. MBIA Inc., 601475/09, the NYCLU, MFY Legal Services Inc. and the Urban Justice Center argued that the Appellate Division, First Department, denied the banks due process when it ruled that the insurance department’s approval of the breakup, which took place without any public hearing or participation by the banks, barred a fraudulent conveyance claim.
