A UBS AG unit will pay more than $33 million to settle claims brought by the National Credit Union Association (NCUA) that UBS lied on certain offering documents for residential mortgage-backed securities (RMBS), according to a federal court filing.
UBS Securities LLC will pay the money to close out the lawsuit filed by NCUA acting in its capacity as liquidating agent for Southwest Corporate Federal Credit Union and Members United Corporate Federal Credit Union. As is typical with such settlements, UBS does not admit any fault as part of the settlement.
The NCUA stated that the RMBS certificates contained offering documents with misstatements regarding compliance with certain underwriting guidelines and reduced documentation standards, including the disclosed loan-to-value ratios.
According to court filings, when they were purchased in 2007, the securities were given an AAA rating but were downgraded to “junk” status by late 2008, contributing to the downfall of both RMBS credit unions.
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If you invested with Southwest Corporate or Members United Corporate and lost money, you may have certain legal rights that require your immediate attention. Contact an experienced Los Angeles investment fraud attorney for a consultation today.