ALEXANDRIA, Va.—Nomura Asset Acceptance Corporation and Nomura Home Equity Loan, Inc. jointly have agreed to pay more than $3 million to settle claims by the National Credit Union Administration alleging the sale of faulty residential mortgage-backed securities to two corporate credit unions, NCUA reported.
“Every recovery NCUA makes through our legal efforts reduces the possibility of further costs of the corporate resolution being shouldered by credit unions,” NCUA Board Chairman Rick Metsger said. “Our legal team continues to work to fulfill the agency’s statutory responsibilities to protect the credit union system and to pursue recoveries against financial firms we maintain contributed to the corporate crisis.”
The settlement covers claims the NCUA board asserted in 2011 as liquidating agent for Western Corporate Federal Credit Union and U.S. Central Federal Credit Union. NCUA filed suit in federal district courts in California and Kansas against the Nomura entities. With this settlement, NCUA will dismiss pending suits against both firms. Neither firm admits fault as part of the settlement agreement, NCUA said.
NCUA noted that it was the first federal financial institutions regulator to recover losses from investments in securities on behalf of financial institutions that failed in the wake of the recent financial crisis.
NCUA still has litigation pending against other financial institutions, including Credit Suisse and UBS Securities, alleging they sold faulty residential mortgage-backed securities to corporate credit unions. NCUA also has pending litigation against various residential mortgage-backed securities trustees and LIBOR banks related to corporate credit union losses.