The National Credit Union Association, an independent federal agency tasked with oversight of federal credit unions, said Tuesday that it filed suit against a battery of major financial institutions for violations of federal and state antitrust laws, as well as the fraudulent sale of securities. Banks accused of wrongdoing include JPMorgan Chase (NYSE:JPM), Morgan Stanley (NYSE:MS), Credit Suisse (NYSE:CS), Barclays (NYSE:BCS), and Goldman Sachs (NYSE:GS).
The news came in two salvos. First, the agency announced that it filed suit in a federal district court in Kansas against 13 international banks, alleging that the firms violated antitrust laws when they manipulated interest rates through the London Interbank Offered Rate (Libor) system. The NCUA claims that manipulation of Libor rates facilitated the failure of five corporate credit unions: U.S. Central, WesCorp, Members United, Southwest, and Constitution. (You can read the complaint here.)
NCUA Board Chairman Debbiew Matz explained: “We have a responsibility to pursue recoveries through every available avenue against those who caused billions of dollars in losses to credit unions. Some firms were manipulating international interest rates in a way that cost the five corporates to lose millions of dollars. Just as we are doing in our other suits, we are seeking to hold responsible parties accountable for their actions.”