The NCUA announced Aug. 30 it filed a suit in Federal District Court in Kansas two weeks earlier against another Wall Street firm that the regulator said sold faulty mortgage-backed securities to failed corporates U.S. Central Federal Credit Union and Western Corporate Federal Credit Union.
Morgan Stanley & Co. Inc. and other firms were named as defendants in the suit, according to an NCUA release. The NCUA said the investment bankers violated federal and state securities laws when it sold more than $566 million in mortgage-backed securities to the U.S. Central and WesCorp.
The complaint alleges the offering documents of the securities contained statements of material fact that were not true or omitted material facts.
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