Nearly two months after the NCUA filed a suit against Wells Fargo for negligence in the case of a deceased financial adviser who worked with member investments at the defunct New London Security Federal Credit Union, the agency has filed a complaint against the CU's accounting firm to recover losses.

According to the March 19 complaint, the NCUA claimed that Beller Shepatin and Co. allegedly committed professional malpractice because the accounting firm failed on several counts to detect fraudulent activity in an investment account held by New London. As a result, the CU was unable to prevent or mitigate the damages caused by the fraudulent investment account, ultimately losing virtually all of its assets. In September 2007, Beller Shepatin merged with Ed Lorah and Associates LLC, which is named as the defendant in the complaint.

Edwin Rachleff was an investment broker and financial adviser for A.G. Edwards & Sons Inc., which later merged with Wachovia Securities and then Wells Fargo, who handled investments for New London. Rachleff allegedly created fake account statements that showed the CU was worth $11.8 million, according to the regulator. The funds were supposedly deposited into the CU's account from 1998 to 2003. However, the NCUA found during an audit that $11.6 million in deposits were not there. As a result, the CU was declared insolvent and then liquidated. Rachleff committed suicide in July 2008 on the same day that NCUA liquidated the CU.