Former WesCorp CFO Demands Jury Trial in NCUA Case
WesCorp’s former chief financial officer on Wednesday asked the federal court in Los Angeles hearing the NCUA’s case against the failed corporate’s executives to order the agency to drop its complaints against him, pay his legal fees and award him damages.
Todd Lane also demanded a jury trial. He made the requests in an amended counterclaim to an amended complaint by the NCUA in the case arising from WesCorp’s 2009 collapse under the weight of investment losses and subsequent conservatorship by the federal regulator.
In mid-March, U.S. District Judge George Wu ruled that Lane and his co-defendants former CEO Robert Siravo, Chief Investment Officer Robert Burrell, Human Resources Director Thomas Swedberg and Chief Risk Officer Timothy Sidley – should be treated as WesCorp creditors and must submit claims for payment to the NCUA only after their case with the agency is completed.
In Lane’s counterclaim, served to NCUA attorneys on Wednesday, he argued that WesCorp, and subsequently the NCUA as the failed corporate’s liquidator, are responsible for his more than $100,000 in legal fees and damages that have occurred by its failure to pay them.
He also argued that California law indemnified him as an officer of the corporation and that WesCorp breached its promise to purchase and maintain insurance against any liability.
The corporate did have a policy with CUMIS but the insurer rejected the claim, saying it did not cover investment liability, Lane’s filing said. He argued that the situation was made worse when NCUA canceled the policy after it took over WesCorp.
The NCUA settled with Sidley and Burrell last month. Sidley’s settlement said each side would bear their own legal costs and he was hit with a prohibition order from the NCUA, banning him from again working for a federally insured credit union.