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News Now

CU System
NCUA WesCorps Sidley settle lawsuit
LOS ANGELES (3/5/12)--The National Credit Union Administration (NCUA) and Thomas T.Sidley, one of the officials it sued as a result of the collapse of Western Corporate FCU, Friday filed a settlement agreement with a federal court in Los Angeles to dismiss the case , according to a stipulation filed Friday.

The matter is before U.S. District Judge George Wu of the U.S. District Court for the Central California, Western Division in Los Angeles. The proposed order stipulates that dismissal of the case would be "with prejudice of all claims and counterclaims" between NCUA and Sidley. Each party would bear all the court costs. 

Sidley was the chief risk officer at WesCorp. The proposed dismissal does not apply to NCUA's claim against any other defendant in the WesCorp case--Robert Siravo, CEO; Thomas Swedberg, head of human resources; Robert Burrell, chief investment officer; and Todd Lane, chief financial officer.

WesCorp was hard hit by losses related to mortgage-backed securities.  NCUA's lawsuit had alleged that senior WesCorp executives were negligent in monitoring the investments of the corporate and that there was a breach of fiduciary duty and fraud related to investments that resulted in $6.8 million in portfolio losses (News Now Jan. 24).  The executives filed counterclaims and affirmative defenses against NCUA, alleging the agency was aware of WesCorp's investment strategies and approved of and encouraged the strategies.


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