By Brian Honea, DS News, January 3, 2016
An independent monitor has credited Morgan Stanley with fulfilling approximately 27 percent of its consumer relief obligation under the terms of a February 2016 RMBS settlement with the New York State Attorney General, according to a report from the monitor.
Eric D. Green, a retired Boston University law professor and independent monitor of Morgan Stanley’s settlement, said he has reviewed and conditionally approved approximately $100.2 million in consumer relief activity for Morgan Stanley since early August.
This was Green’s second report on Morgan Stanley’s activity regarding the settlement; in the first report, issued August 9 last year, he credited the investment banking firm with $10.5 million worth of conditional credit. The combined total gives Morgan Stanley $110.7 million in conditional credit (27 percent) toward fulfilling its $400 million settlement obligation, according to Green. Credit is conditional upon Green’s final approval when Morgan Stanley’s total obligation is fulfilled under the terms of the settlement.
Green stated that Morgan Stanley is “off to a good start,” toward satisfying the terms of the settlement as a result of the relief provided from August to December. Morgan Stanley provided consumer relief under three menu items (covering five categories) under the Settlement Agreement, with the largest portion ($57.6 million, more than half) coming in the form of the forgiveness of 502 second-lien loans. According to Green, 302 of those loans were located in areas designed by HUD as Hardest Hit Areas, or those that suffered the worst economic damage as a result of the crisis in 2008.
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