CUNA CEO Bill Cheney said he is "disappointed" NCUA has chosen to pursue gross negligence and breach of fiduciary duties charges against him in the Western Corporate FCU lawsuit.
"I completed my board service in February 2006, before the securities that caused the majority of losses at WesCorp were purchased in a period when NCUA had an examiner on-site at WesCorp," Cheney said in a statement yesterday.
NCUA claims in court documents WesCorp dramatically changed its asset liability management strategy beginning in 2002 when former CEO Robert Siravo was hired. WesCorp increased borrowings from $420 million to $1.28 billion during Siravo's first two years on the job.
The suit also states WesCorp increased its concentration limits for private label mortgage backed securities from 950% of capital in 2002 to 1700% of capital in 2003, and raised it again to 2150% of capital in 2005.
Cheney joined WesCorp's board of directors in May 2002, and was a member of the asset/liability committee from June 2002 to November 2005.
CUNA's leader stressed WesCorp's volunteers were unpaid, and received no financial benefit of any kind.
Further, the case will not diminish CUNA's effectiveness, nor Cheney's focus on advancing CUNA's goals and priorities, he said