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Credit Unions Reach Settlement With Deutsche Bank and CITI

Mortgage News > Credit Unions Reach Settlement With Deutsche Bank and CITI
Date: 11/14/2011    Credit Unions Reach Settlement With Deutsche Bank and CITI

The National Credit Union Administration, or NCUA, filed suit against underwriting companies Deutsche Bank on the grounds that it misled five now failed credit unions in regards to mortgage-backed securities that were purchased.  The NCUA also filed charges against Citi in an unrelated case.

Both Deutsche Bank and Citi agreed to settle with the NCUA to avoid further litigation.  Deutsche Bank settled in the amount of $145 million, and Citigroup Inc. settled for $20.5 million.

Debbie Matz, NCUA Chairman, responded to the settlements in an interview by saying "We are very pleased we have reached an out-of-court settlement with the two underwriters." Matz went on to say “We are hoping this will lead to settlements with some of the other underwriters and financial institutions."

The credit unions represented by the NCUA's claims are U.S. Central Corporate Credit Union, Members United Corporate Credit Union, Southwest Corporate Credit Union, Constitution Corporate Credit Union and Western Corporate Credit Union, also known as WesCorp.