CUNA Mutual Group Sues RBS Over RMBS

On January 17, 2012, RBS Securities removed to the Western District of Wisconsin an action brought by credit union insurance companies against RBS involving the sale of RMBS. The bases for RBS’s removal petition include diversity jurisdiction and related to bankruptcy jurisdiction. The case originally was filed on December 14, 2011, in the State of Wisconsin Circuit Court by Credit Union National Association Mutual Insurance Society, CUMIS Insurance Society, and Member Life Insurance Company. The insurance companies seek rescission of $72 million in RMBS securities, alleging that RBS inflated the value of the mortgages and knowingly made material misrepresentations about underwriting standards and the collateral backing the loans. Notice of Removal. Complaint.