Allstate sues JPMorgan Chase over sale of toxic RMBS

Insurance giant Allstate is suing JPMorgan Chase (JPM: 47.72 -0.21%) and subsidiaries Bear Stearns and Washington Mutual for fraudulently selling the insurer more than $750 million in residential mortgage-backed securities backed by toxic loans. In its complaint, Allstate alleges the defendants "made numerous misrepresentations and omissions regarding the riskiness and credit quality" of the loans backing the securities sold as part of the transaction. JPMorgan Chase acquired Bear Stearns and Washington Mutual — along with the banks' assets — back in 2008 when the housing meltdown hit. While both firms are technically defunct, each still has structured finance trading platforms...