Nuns sue bank over subprime investment

April 8, 2009 at 1:17 PM

DUBUQUE, Iowa, April 8 (UPI) -- Nuns from an order based in Iowa have sued a Boston bank, claiming that they were duped into investing $1 million in the subprime mortgage market.

The lawsuit against the State Street Bank and Trust was filed in federal court in New York City, New York's Daily News reported Wednesday. The order, the Sisters of Charity of the Blessed Virgin Mary, says advisers at the bank convinced the nuns that the "Enhanced Dow Jones-AIG Commodities Future Strategy" promised a good return with little risk.

In the end, the entire $1 million, about 5 percent of the order's investment funds, disappeared.

Like many orders of nuns, the Sisters of Charity have few members actively working, about 150, and many who are retired, 400.

"Any person who is facing retirement counts on their investment funds to assist them," Sister Mary Ann Zollmann, the order's head, told the Daily News. "In a congregation as large as ours ... the need is significant."

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