Goldman Sachs was hit with another lawsuit involving a soured portfolio of mortgage-backed securities - this time by bond insurer CIFG Assurance North America, which also is suing M&T bank.  CIFG claims both banks fraudulently convinced it to insure $275mn in mortgage-backed securities.  The securities in question are backed by a portfolio of 6,204 loans - most of which were issued by M&T - that Goldman packaged into securities products. After reviewing a sample of defaulted loans in the portfolio, CIFG says that most of them violate Goldman's internal policies and M&T's representations and warranties on the loans. 

It's hardly the first suit to be brought against Goldman over mortgage bonds, and they all seem to make similar allegations:  that the firm internally knew that the bonds were shaky while marketing them as solid.  

CIFG is the latest bond insurer to sue Goldman over MBS's that went bad, and the latest to make a similar claim - that Goldman knowingly sold shaky mortgage bonds to get the risk off its books.  ACA Financial Guaranty sued Goldman in January for similar reasons.   [Reuters, 8/17/11]