Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Tuesday, August 9, 2011

NCUA Sues Goldman Sachs for Fraud on Behalf of Failed Credit Unions

The National Credit Union Administration filed suit today against New York firm Goldman Sachs & Co. alleging violations of federal and state securities laws, as well as misrepresentations in the sale of securities to now-failed U.S. Central and Western Corporate federal credit unions.  As liquidating agent for the failed corporate credit unions, NCUA can seek recoveries from responsible parties to minimize cost to its insurance funds and the credit union industry.

This law suit follows three similar legal proceedings, two filed in the Federal District Court of
Kansas June 20 against J.P. Morgan Securities, LLC, and RBS Securities, and one in the Federal
District Court in Central California also against RBS July 18. This action seeks damages in excess of $491 million from Goldman Sachs, bringing the total sought in the four lawsuits filed to date to nearly $2 billion.

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