Banking Law

JPMorgan Axes Linklaters Over Bear Stearns Suit

As major corporate law firms in New York and London have begun to relax a traditional taboo against suing investment banks, it can be a challenge to take on these lucrative cases without offending longtime clients. This has been demonstrated by the punishment dealt out to Linklaters by JPMorgan Chase,…

Jun 23, 2008 6:26 PM CDT

Will Prosecutors Get Help From ‘Toast’ E-Mail by Bear Stearns Manager?

Updated: Indictments of two Bear Stearns hedge fund managers were announced today, and an e-mail warning of looming problems may play a role, the Wall Street Journal reports. Fund manager Matthew Tannin, a law school graduate, and his superior, Ralph Cioffi, were indicted (PDF provided by Wall Street Journal Law…

Jun 19, 2008 1:05 PM CDT

Treasury Secretary to Call for Greater Powers for Federal Reserve

Treasury Secretary Henry Paulson is expected to call for new powers for the Federal Reserve to deal with risks to the entire financial system. In a speech prepared for delivery today, Paulson says the nation expects the central bank to intervene to “avert events that pose unacceptable systemic risk,” the…

Jun 19, 2008 11:14 AM CDT

Bear Stearns Ace Joins K&L Gates

The former managing director of the Bear Stearns legal arm in New York has joined Kirkpatrick & Lockhart Preston Gates Ellis as a partner. Phillip Cedar, who was in private practice with Skadden Arps Slate Meagher & Flom before he joined the now-struggling investment bank, is expected to focus his…

Jun 16, 2008 9:34 PM CDT

Fearing Foreclosure, Debtors Sue Lenders Over Excessive Mortgages

Rather than waiting for lenders to foreclose, a group of struggling borrowers in Florida has turned the tables by suing those who gave them mortgages they can’t afford to pay. “They have beaten their lender to the courthouse by filing lawsuits that allege the institutions committed fraud and violated federal…

Jun 12, 2008 6:27 PM CDT

More than 30 Thacher Lawyers Quit in Last 6 Months

Ten U.S. partners and about 24 associates of Thacher Proffitt & Wood have voluntarily left the New York-based firm during the past six months, in advance of an expected drop in 2008 profits. Meanwhile, 60 associates have been laid off by the 220-attorney financial services boutique, whose structured finance practice…

Jun 11, 2008 8:25 PM CDT

Criminal Cases Against Mortgage Leaders Unlikely, Despite Subprime Crisis

Updated: Although the FBI and U.S. Department of Justice are reportedly investigating mortgage industry leaders after a foreclosure crisis sparked by failing subprime loans, criminal cases against them appear unlikely. For one thing, because of the complexity of the situation, it will probably take years to sort the situation out.…

Jun 9, 2008 5:13 PM CDT

Debt Collectors Clog Chicago Courts With Sometimes-Dubious Claims

A key function of Cook County Circuit Court in Chicago is to act as a debt-collection machine. Since 2000, the volume of debt collection cases in Cook County has more than doubled, to not quite 130,000, reports the Chicago Tribune. But busy debt collectors—who historically have won default judgments in…

Jun 9, 2008 3:27 PM CDT

Worried About Class Action Damages, Banks Block Private Auction-Rate Sales

Among those who bought auction-rate securities based on widespread expectations that they could easily be sold is San Diego lawyer Chris Longman, 35. But now he and his wife reportedly have a problem. They want to use the $375,000 to buy a house, but they can’t liquidate, even at a…

Jun 6, 2008 4:23 PM CDT

Billionaire Olenicoff’s Plea Docs Describe Tax Evasion Techniques

Recent court filings concerning a tax evasion plea deal by billionaire Igor Olenicoff may cast a brighter light on similar efforts by less-wealthy individuals to evade U.S. income tax. Filings in federal court in Santa Ana, Calif., show the real estate magnate had accounts with Barclays Bank in the Bahamas,…

May 30, 2008 11:18 PM CDT

Subprime Suits Expected to Dwarf S&L Litigation, New Report Suggests

A new report finds that 448 subprime-related cases were filed in federal courts in the 15 months that ended on March 31, a total that is outpacing litigation over the savings and loan crisis. The study by Navigant Consulting covered suits filed from Jan. 1, 2007, to March 31, 2008,…

May 20, 2008 11:01 AM CDT

Bank Said $280,000 Deposit was Valid, But Now Wants It Back

When $280,000 was mistakenly deposited in October into the bank account of a retired couple in midstate Pennsylvania, they did the right thing, according to their lawyer, and notified the bank. But when First Commonwealth Bank representatives repeatedly assured them that the deposit was correct, they did the natural thing…

May 15, 2008 7:51 PM CDT

Judge Refuses to Dismiss Countrywide Shareholder Suit

A California federal judge has refused to dismiss a shareholder lawsuit against directors and officers of Countrywide Financial Corp. Judge Mariana Pfaelzer ruled Tuesday that confidential witness accounts cited in the complaint were credible and suggested “a widespread company culture that encouraged employees to push mortgages through without regard to…

May 15, 2008 10:58 AM CDT

Internet Wild West of Payday Lenders Needs Regulation

Now that many states have laws in place to try to prevent payday lenders from bankrupting consumers with short-term loans at extraordinarily high interest rates, it turns out that a number of payday lenders are a step ahead of the government regulators. They now offer such loans over the Internet,…

May 12, 2008 7:04 PM CDT

Will U.S. Credit Card Crackdown Make a Major Difference?

The mortgage meltdown, which many now attribute at least in part to widespread fraudulent practices, seems to have had an unexpected effect on federal regulators. Instead of waiting for a similar disaster to develop in the consumer credit market, they are proposing tough new rules to restrict some of the…

May 9, 2008 8:58 PM CDT