The alleged losses stemmed from what the plaintiffs view as "loan to own" deals which in some cases allowed developers to pocket approximately half of the loan amount as a "dividend." The suit claims that the bank aimed to inflate real estate values and earn "enormous fees" for the bank and then foreclose on the properties and take control of them at below market value.
Last May, while ruling in favor of Cross Harbor Capital Partners in its bid to wrest control of Yellowstone from Credit Suisse, a federal judge decried Credit Suisse's "predatory lending practices" and said, "the naked greed in this case shocks the conscience of the court."
Credit Suisse denied the accusations and declared that it would "vigorously" defend itself.
