NCUA Files Suit Against Wells Fargo Over RMBS – NMP Skip to main content

NCUA Files Suit Against Wells Fargo Over RMBS

NationalMortgageProfessional.com
Dec 23, 2014

The National Credit Union Administration (NCUA) has filed suit in federal court against Wells Fargo Bank, alleging Wells Fargo violated state and federal laws by failing to fulfill its duties as trustee for 27 residential mortgage-backed securities (RMBS) trusts. The NCUA is suing in its capacity as liquidating agent for five failed corporate credit unions. NCUA’s complaint, seeks damages to be determined at trial.

“Like other trustees against whom NCUA is pursuing claims, Wells Fargo neglected its statutory and contractual obligations to certificate holders, including the five corporate credit unions,” NCUA Board Chairman Debbie Matz said. “This litigation is intended to hold Wells Fargo accountable for losses caused by that neglect.”

Five corporate credit unions—U.S Central, WesCorp, Members United, Southwest and Constitution—purchased approximately $2.4 billion in RMBS issued from the trusts between 2004 and 2007. Those securities were faulty and lost substantial value, contributing to the failure of all five corporates.

NCUA’s complaint states the value of the securities depended on the quality of the pooled mortgage loans the trusts contained, and the bank, as trustee, had contractual and statutory duties to protect the interests of certificate holders. The complaint states that, despite knowing about defects in the mortgage loans, Wells Fargo failed to provide required notices to certificate holders and other parties and failed to take timely action to force the repurchase, substitution, or cure of defective mortgage loans or otherwise preserve trust remedies.

Published
Dec 23, 2014
Ginnie Mae Exits The Stone Age And Embraces Blockchain

'Some of the procurement stuff that we do, maybe it’s archaic, maybe it needs to be innovated.'

Industry News
Jan 26, 2022
Katten Partner To Head Women In Securitization

Katten announced that Claudine Chen-Young, a partner in its Structured Finance and Securitization practice in Washington, is the newly named chair of Women in Securitization.

Industry News
Jan 26, 2022
AFR Adds Director Of Marketing

American Financial Resources, Inc. named Lauren Blackburn as its director of marketing, where she will be tasked with driving the company's marketing strategy.

Community
Jan 26, 2022
Standard Communities Creates Affordable Housing For The 'Missing Middle'

Standard Communities is taking over housing stock in the least affordable areas in America.

Industry News
Jan 26, 2022
KBRA Assigns Preliminary Ratings To CSMC 2022-NQM1 Trust

Kroll Bond Rating Agency assigned preliminary ratings to CSMC 2022-NQM1, a $553.7 million non-prime RMBS transaction sponsored by DLJ Mortgage Capital, Inc.

Non-QM
Jan 25, 2022
Hunt Mortgage Appoints Chief Operating Officer

Bindiya Jain previously has served as a vice president at South Shore Bank and at UniBank for Saving. 

Industry News
Jan 25, 2022