A United States regulator has sued 17 large banks and financial institutions over losses on about $US200 billion of subprime bonds.
The move may hamper a broader government settlement of the mortgage mess left over from the housing crisis.
The lawsuits by the Federal Housing Finance Agency (FHFA), which oversees Fannie Mae and Freddie Mac, surprised investors, dragging down bank shares.
The FHFA accused Bank of America and its Countrywide and Merrill Lynch units, Barclays, Citigroup, Goldman Sachs , JPMorgan Chase & Co, Royal Bank of Scotland and others of misrepresenting the checks they had done on mortgages before bundling them into securities.
According to the lawsuits, the securities should have never been sold because the underlying mortgages did not meet investors' criteria.
