A legal suit had been initiated against J.P.Morgan and Bank of America by Sealink Funding Ltd over the mortgage debt loses. The plaintiff said it had bought residential mortgage-backed securities (RMBS) worth USD 2.4 billion from JPMorgan and USD 1.6 billion from Bank of America from 2005 to 2007, trusting upon the offering materials that were deceptive about the quality of the securitised loans. The defendants in order to secure a triple A reward for its RMBS had deliberately provided false information to the credit rating agencies. Similar claims had been raised by Germany’s Landesbank Baden-Wurttemberg in a separate lawsuit against JPMorgan over USD 500 million of RMBS that it bought. The lawsuits accused the banks for packaging several high risked mortgages by the issuers with the motive of high profits. This had in turn resulted in higher rates of default on the loans underlying the defendants’ RMBS and immense downgrades of the investors’ certificates. The investors through the lawsuits filed on Thursday in the New York State Supreme Court in Manhattan sought Compensatory and castigatory damages. Lawrence Grayson, spokesman for Bank of America said that the bank will proceed with the action of defence against the lawsuit which was just another one initiated by a “sophisticated investor”  for the purpose of blaming someone for losses caused by economic recession. JPMorgan spokeswoman Jennifer Zuccarelli refused to remark.

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The judge Sharon Lovelace Blackburn of Federal District Court in Birmingham on Wednesday upheld most of the provisions of new immigration law of Alabama including the public school enrollment. This gives the authorities the power to question the people suspected to have made illegal entry in the country and hold them without bond. By this ruling Alabama has turn out the first state in the nation to require public schools to check the immigration status of students when they enroll. Those who favour the law argue that the law helps to keep a track of the illegal immigrant students in the nations and calculate the costs spend on their education and will no way obstruct the enrollment in schools. But the opponents argue that the law when taken in its broader perspective deprive many innocent children from their constitutional right of education in case they do not have sufficient documents with them. Civil rights and immigrant advocacy groups are soon to go for an appeal whereas the Obama administration on Friday went for an appeal against this ruling on the ground that immigration is a federal matter under U.S. Constitution and state has no authority to make patchwork on that subject.

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