News Summary: Morgan Stanley faces lawsuit
NEW YORK (AP) — THE LAWSUIT: Morgan Stanley is being accused of discriminating against black homeowners and violating federal civil rights laws by providing strong incentives to a subprime lender to originate mortgages that were likely not to be repaid. Morgan Stanley says the allegations are without merit and that it will defend itself against the accusations.
ACLU: The lawsuit was filed by the American Civil Liberties Union and others on behalf of five Detroit residents and Michigan Legal Services. The homeowners in the lawsuit received their loans from subprime lender New Century Mortgage Corp., which has since collapsed.