NCUA Sues Multiple Banks for $2.4 Billion

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On September 23, the National Credit Union Administration (as liquidator for the Southwest Corporate Federal Credit Union and Members United Corporate Federal Credit Union), filed nine separate suits in the federal district court for the Southern District of New York against several investment banks for a total of $2.4 billion. The NCUA alleges material misrepresentations and omissions of underwriting standards, LTV ratios, owner-occupancy rates, DTI ratios and credit ratings in connection with the credit unions’ alleged purchases of RMBS and brings causes of action under Sections 11 and 12(a)(2) of the Securities Act of 1933 as well as claims for violations of the Illinois and Texas securities laws. Complaint Against Morgan Stanley.

Topics:  Investment Banks, Misrepresentation, NCUA, RMBS, Securities Act of 1933

Published In: Business Torts Updates, Finance & Banking Updates, Securities Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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