Ambac, Underwriters Settle Putative Class Action for $33 Million

On May 6, 2011, Ambac Financial Group, Inc., several of its officers and directors, and several underwriters of Ambac securities offerings filed stipulations of settlement with the Southern District of New York to resolve a putative shareholder class action filed on behalf of purchasers and acquirers of Ambac securities. Plaintiffs claimed that the now bankrupt bond insurer concealed that it had lowered its policy underwriting standards, allowing it to insure risky financial products, including RMBS. The settlements provide for payments of $2.5 million by Ambac, $24.6 million by Ambac’s D&O policy insurers, and $5.9 million by the underwriters, UBS Securities, Goldman Sachs & Co., and JP Morgan Securities. Ambac Complaint. Ambac Settlement. Ambac Underwriters Settlement.