Just one day after disclosing a settlement with an investment banker over toxic residential mortgage-backed securities, the National Credit Union Administration is at it again.
On Thursday, the regulator announced that a $29 million settlement with Credit Suisse had been expanded to include pre-judgment interest — bringing the total to $50.3 million.
The agreement resolved Credit Suisse’s role in the sale of toxic RMBS to
Members United Corporate Federal Credit Union and Southwest Corporate Federal Credit Union.
Both of the
corporate credit unions failed in 2010 thanks, in part, to bad RMBS investments.
On Friday,
the NCUA announced a $69.8 million settlement with UBS. The total includes $33 million in damages, while the rest is pre-judgment interest.
As was the case with Credit Suisse, UBS was accused of selling faulty RMBS to
Members United and Southwest.
“Part of NCUA’s comprehensive strategy for resolving the corporate crisis has been an aggressive litigation effort to secure recoveries from the Wall Street firms whose sale of faulty securities precipitated the crisis,” NCUA Board Chairman Debbie Matz said in the statement.
So far, the NCUA has collected more than $3.1 billion in recoveries tied to the corporate credit unions’ RMBS investments.
In addition, it still has another lawsuit pending against UBS for RMBS purchased by
two other failed corporate credit unions: U.S. Central and WesCorp.
“NAFCU and our members appreciate NCUA’s tenacity in pursuing recoveries on the sale of faulty securities that led to the downfall of five corporate credit unions,” National Association of Federal Credit Unions Executive Vice President of Government Affairs and General Counsel Carrie Hunt said in a statement.
