FDIC sues 12 banks over mortgage bonds sold to Colonial

The Federal Deposit Insurance Corp. sued 12 major banks Friday for selling allegedly faulty mortgage bonds to defunct Colonial Bank.

Montgomery, Ala.-based Colonial failed in August 2009 with more than $25 billion in assets after bad bets on housing and a lending scandal tied to now shuttered Taylor Bean & Whitaker. At the time, the FDIC

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