Sept 19 Investors who hold $73 billion in
residential mortgage-backed securities issued by Wells Fargo &
Co and Morgan Stanley have sent notices to the
banks alleging they did not perform their duties servicing the
The bondholders are represented by the Gibbs & Bruns law
firm that last year reached an $8.5 billion settlement with Bank
of America Corp on behalf of investors who held soured
mortgage-backed securities. The pact is still awaiting court
The notices cover more than $15 billion of Wells
Fargo-issued securities and more than $5 billion of Morgan
Stanley-issued securities in which the investors hold 25 percent
or 50 percent or more of the voting rights, depending on the
security, the law firm said on Wednesday.
In addition, the notices also cover $30 billion of Wells
Fargo-issued securities and $23 billion of Morgan Stanley-issued
securities in which the investors have significant voting rights
but less than 25 percent or 50 percent.
Gibbs & Bruns attorney Kathy Patrick did not immediately
respond to a request for comment.
Wells Fargo will "review any communications we receive and
respond appropriately," bank spokeswoman Mary Eshet said. Morgan
Stanley spokeswoman Mary Claire Delaney declined to comment.