Federal prosecutors announced fraud charges late Monday against the former head of Deutsche Bank’s subprime trading unit, accusing him of knowingly selling $1.4 billion worth of real estate-backed securities backed by problematic loans.
According to prosecutors, Paul Mangione knew that key aspects of the home loans packaged as securities, including their compliance with lending standards, the borrowers’ ability to pay, as well as their fraud and appraisal accuracy, were misrepresentations. The charges were filed in the U.S. District Court for the Eastern District of New York.
