The NCUA on Sept. 23 filed nine federal lawsuits in New York against eight banks over the sale of nearly $2.4 billion in mortgage-backed securities to failed corporates Southwest Corporate Federal Credit Union and Members United Corporate Federal Credit Union.
The suit marks the first time the NCUA is seeking damages from losses sustained only at those two corporates.
The NCUA claimed defendants Morgan Stanley & Co. Inc. and Morgan Stanley Capital I Inc., Barclays, J.P Morgan/Bear Stearns, Credit Suisse, Royal Bank of Scotland and UBS sold faulty securities to the corporates. Additionally, Goldman Sachs, Wachovia and Residential Funding Securities LLC, now Ally Securities, sold faulty securities to Southwest Corporate.
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