A law firm that won an $8.5 billion settlement from Bank of America Corp. tied to faulty mortgage bonds said that Wells Fargo & Co. and Morgan Stanley failed to service $73 billion of similar securities, creating a default, Bloomberg News reported yesterday. Gibbs & Bruns LLP cited at least $15 billion of Wells Fargo's residential mortgage-backed securities and $5 billion from Morgan Stanley where holders have 25 percent or 50 percent or more of the voting rights, according to the Houston-based law firm. The dispute also covers $23 billion of Morgan Stanley-issued RMBS and $30 billion of Wells Fargo's RMBS where holders "have significant voting rights, but less than 25 percent or 50 percent," the firm said.
