NCUA Chairman Debbie Matz said Thursday she's pleased KansasFederal District Court denied the majority of defendants' motions to dismiss the agency's lawsuits for losses frommortgage-backed securities purchased by U.S. Central Federal CreditUnion.

“The Wall Street firms that created and sold these securitiesmaterially misrepresented the inherent level of risks toinvestors,” Matz said. “We will continue to vigorously pursue theselawsuits, and the others previously filed. As liquidating agent forU.S. Central, NCUA has a duty to maximize recoveries fromresponsible parties, in order to limit losses to the federallyinsured credit union system.”

NCUA filed two lawsuits against RBS Securities, Wachovia, andnine other defendants who were involved in issuing 29 residentialmortgage-backed securities purchased by U.S. Central. The lawsuits,which were consolidated by the court, alleged violations of federaland state securities laws and misrepresentations in the sale of thesecurities to U.S. Central. The court granted part of thedefendants' motions to dismiss and denied the remainder, with theresult that 80% of the claims continue forward, the NCUA said in arelease.

The lawsuits covered by the court's ruling are similar toseveral other cases previously filed by NCUA as liquidating agentfor U.S. Central and Western Corporate Federal Credit Union againstJ.P. Morgan Securities, Goldman Sachs, and others. NCUA haspreviously settled claims worth $170.75 million with Citigroup,Deutsche Bank Securities, and HSBC.

Losses from the U.S. Central, WesCorp, and three other corporatecredit union failures are paid from the Temporary Corporate CreditUnion Stabilization Fund and are being repaid through assessments on federally insured credit unions. Net proceedsfrom the settlements received to date, as well as any futurerecoveries, will allow NCUA to minimize losses from the fivecorporate credit union failures. They will also help to reduce thetotal amount that credit unions have to pay for the corporatecredit unions' system losses, the NCUA said.