GLOBAL - The €240bn civil service scheme ABP has filed suit against investment bank JP Morgan Chase for losses on its mortgage-backed securities.
"JP Morgan had made us believe that the moon was made of green cheese, as the investments in collaterised debt obligations (CDO) were much riskier than the bank suggested," a spokesman for ABP said.
"In our opinion, JP Morgan was fully aware of the risks, as it was involved in every step of the mortgage lending process," he said, adding: "We think that the bank also wrong-footed the rating agencies, who rated the investments as safe AAA."
However, the spokesman declined to provide details of ABP's claim or comment on the size of its CDO portfolio "for trial-technical reasons".
The lawsuit was filed at the New York State Supreme Court in Manhattan by US law firm Grant & Eisenhofer on a no win, no fee basis.
The securities were collaterised against mortgages from JP Morgan, EMC - a subsidiary of US bank Bear Stearns - and Washington Mutual Bank, the lawsuit said.
Both Washinton Mutual and Bear Stearns were acquired by JP Morgan in 2008.
According to the lawsuit, many mortgage borrowers did not repay their loans, which could then not be resold at prices close to that of the original acquisition.
A spokeswoman for JP Morgan declined to comment.
In September, ABP filed a complaint against Deutsche Bank for fraud related to "misleading statements" made regarding residential mortage-backed securities.