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News Now

CU System
Barclays tells court NCUAs MBS suit filed too late
KANSAS CITY, Kan. (11/29/12)--Barclays has asked a federal court in Kansas to dismiss the National Credit Union Administration's (NCUA) lawsuit against it over $555 million in mortgage-backed securities sold by a Barclays unit to U.S. Central FCU and the Western Corporate FCU in 2006 and 2007.

NCUA's suit, filed Sept. 25 in the U.S. District Court for the District of Kansas, Kansas City, alleges that Barclays Capital Inc., BCAP LLC and Securitized Asset Backed Receivables LLC made misleading statements about the MBS that contributed to the failure of the two corporates.

Barclays' motion filed Monday with the court alleges the case should be dismissed because:

  • The court is not the proper venue for NCUA's claims;
  • NCUA's claims are barred by the statute of limitations and statue of repose, which means Barclays' is arguing NCUA did not file its lawsuit in time; and
  • NCUA did not plead any actionable misrepresentations or omissions in the offering materials.  Barclays said the offering materials accurately disclosed the risk profiles of the certificates; the NCUA didn't plead that the materials reflected misrepresentations regarding underwriting guidelines; statements about LTV ratios are non-actionable opinions; and the agency had not pleaded that owner occupancy representations were false when made.
The corporate credit unions were liquidated by NCUA in 2010.  Barclays' motion argues that federal law requires NCUA to file claims within a year after the alleged violations were, or could have been, discovered.


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