WASHINGTON – NCUA told a congressional committee that a government-wide ban on contingency legal arrangements does not apply to suits it has brought against Wall Street banks over the failure of the corporate credit unions because as liquidating agents for the corporates it is not acting as a “government agency.”

The government-wide ban “does not prohibit the NCUA from entering into contingency fee arrangements when it is serving in its capacity as Conservator of as Liquidating Agent of a federally insured credit union,” NCUA’s Inspector General told Rep. Darrel Issa, chairman of the House Oversight Committee, who requested the information. “In brief, NCUA as Conservator succeeds by operation of law to all the rights, powers and duties of the credit union. To be more specific, NCUA as Conservator “steps into the shoes” of the credit union and is no longer functioning as a government agency.”

Subscribe Now

Authoritative analysis and perspective for every segment of the credit union industry

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.