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Morgan Stanley execs say Pallotta involved in subprime mortgages, depositions show
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Race
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| Contributor | WSNJ |
| Last Edited | WSNJ Aug 01, 2020 06:39pm |
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| Category | News |
| Author | Nikita Biryukov |
| News Date | Saturday, August 1, 2020 12:00:00 AM UTC0:0 |
| Description | banker, but two of his colleagues testified under oath that he was responsible for some high-risk home loans that contributed to the mortgage crisis leading to an economic recession.
After Pallotta began to explore a bid for the Republican nomination for Congress in early 2019, the Democratic Congressional Campaign Committee dubbed him “the subprime King of New Jersey.”
Pallotta’s response to that came swiftly.
“To be clear, in my 25 years on Wall Street, I never spent a single day in subprime mortgages,” he told the New Jersey Globe in 2019, but previously unreported depositions with Morgan Stanley executives suggest otherwise.
In an April 2016 deposition stemming from a suit against Morgan Stanley by the Federal Home Loan Bank of Seattle, Francis N. Telesca, who was an executive director in the firm’s subprime division until 2017, said Pallotta was more involved than he let on.
“I believe that he had coverage responsibilities that extended to some subprime sellers,” Telesca testified, court records show. |
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