Financial Institutions Reform Recovery Enforcement Act

News & Analysis as of

Claims Against Failed Banks Must Go Through the FDIC’s Administrative Claims Process

As described in a previous post, the Financial Institutions Reform, Recovery, and Enforcement Act (“FIRREA”) requires that anyone with a claim against a failed bank must file a claim with the FDIC within 90 days of being...more

Georgia District Court Judge Rules that FIRREA Precludes D&O Insurer Declaratory Judgment Actions Against FDIC as Receiver and...

On March 5, 2014, Judge Richard Story in the United States District Court for the Northern District of Georgia issued an order denying Plaintiff OneBeacon Midwest Insurance Company’s (OneBeacon) Motion for Limited...more

The FDIC’s Administrative Claims Process for Failed Banks

Enacted by Congress after the Savings and Loan Crisis of the 1980s, the Financial Institutions Reform, Recovery, and Enforcement Act (“FIRREA”) gives the FDIC sweeping authority to resolve the problems posed by a failed...more

Federal Government Seeks Higher Penalties In GSE Fraud Case

On January 29, the DOJ filed a supplemental brief in support of its claim for civil penalties following a jury verdict it obtained last October in the first case alleging violations of FIRREA in connection with loans sold to...more

"Government Enforcement: Aggressive Efforts Continue Around the Globe"

Government enforcement efforts in 2013 produced major settlements of matters relating to the global financial crisis, high-profile insider trading convictions, near-record amounts of FCPA settlements, and new pledges of...more

Real Property, Financial Services & Title Insurance Case Law Update: Week Ending January 24, 2014

I. FLORIDA STATE CASES – JOURDAN HAYNES - - Condominiums: given ambiguity in Condominium Act’s escrow requirements (Fla. Stat. § 718.202) and fact that willful violation of same by developer carried criminal penalties,...more

Banking Bulletin: New Year Brings New Mortgage Regulations

The Higher-Priced Mortgage Loans (HPML) Appraisal Rule, part of Regulation Z, goes into effect on January 18th of this year. At that time, many lenders will begin using the exemption relating to “certain streamlined...more

Bah-Humbug: The JPMorgan Settlement & Cy Pres Remedies

Maybe I’m just getting a head start on my “bah humbug” mood for the holidays, I don’t know. Did it strike anyone else as discordant that almost a third of the record-setting JPMorgan RMBS settlement was ear-marked to fund...more

SDNY Grants DOJ’s Request To Add Bank Executive To Pending FCA/FIRREA Litigation

On December 12, the U.S. District Court for the Southern District of New York granted the DOJ’s motion to add a bank executive to a civil fraud suit it filed over a year earlier against a mortgage lender alleged to have...more

Challenging FIRREA Subpoenas: The RMBS Working Group Faces Subpoena Fight

As the Justice Department has stepped up its pursuit of financial institutions, there has been a surge of civil fraud lawsuits brought by the government under FIRREA — the Financial Institutions Reform, Recovery, and...more

November 2013: Securities Litigation Update

Rating Agency S&P’s “Puffery” Defense Rejected in U.S.’s Landmark Fraud Case Under FIRREA. Credit-rating agencies have successfully asserted several defenses to private investors’ fraud claims, including a First Amendment...more

FIRREA: The New Weapon of Choice for Federal Prosecutors [Video]

In 2013, the Department of Justice Civil Division has brought several actions claiming violations of The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA). Pepper Hamilton recently hosted a webinar...more

Federal, State Authorities Announce Largest RMBS Settlement To Date

On November 19, the DOJ, other federal authorities, and state authorities in California, Delaware, Illinois, and Massachusetts, announced a $13 billion settlement of federal and state RMBS civil claims, which were being...more

Creditors’ Deficiency Rights Impacted by Recent Nevada Supreme Court Opinion in Sandpointe Apartments, LLC v. Eighth Judicial...

On November 14, 2013, in Sandpointe Apartments, LLC v. Eighth Judicial District Court, 129 Nev. Adv. Op. 87 (Nov. 14, 2013), and in Branch Banking and Trust Co. v. Neilson, (Nov. 14, 2013) (unpublished), the Nevada Supreme...more

DOJ Secures Jury Verdict In First GSE Civil Fraud Suit

On October 23, a jury found a bank liable on one civil mortgage fraud charge arising out of a program operated by a lender the bank had acquired. The jury also found against a former executive of the acquired lender....more

Expanding FIRREA Liability for Financial Institutions: Southern District of New York Developments [UPDATE]

A recent SDNY ruling strengthens the Department of Justice’s expanding application the Financial Institutions Reform, Recovery and Enforcement Act of 1989. UPDATE On October 23, a jury returned the first FIRREA...more

Another Court Affirms DOJ Financial Fraud Strategy

On Sept. 24, 2013, Judge Jesse Furman in the Southern District of New York released his widely anticipated decision allowing the U.S. Department of Justice’s False Claims Act and Financial Institutions Reform, Recovery and...more

Limited Defenses Available Against FDIC As Receiver

As of August 2013, since the fallout from the recent financial crisis, the FDIC as receiver for failed banks has brought suit against former directors and officers of 76 failed institutions. These lawsuits are based on...more

FIRREA: The DOJ’s Expansive (and Expensive) Tool of Choice

A series of recent court rulings has effectively expanded the Department of Justice’s authority to investigate and prosecute banks for claims related to the financial crisis. These rulings have broadly interpreted a...more

Southern District Of New York Again Endorses DOJ Mortgage Fraud Theory

On September 24, U.S. District Court Judge Jesse Furman largely denied a bank’s motion to dismiss a complaint filed by the U.S. Attorney’s Office for the Southern District of New York (SDNY) in which the government alleges...more

Texas Federal District Court Allows Government’s FCA/FIRREA Mortgage Suit To Proceed

On September 10, the U.S. District Court for the Southern District of Texas denied a mortgage lender’s motion to dismiss the federal government’s claims that the lender and two of its executives knowingly made false...more

Avoiding The FCA & FIRREA Trap: Practical Tips For Compliance Professionals

As the government becomes increasingly aggressive in its efforts to fight financial fraud, companies naturally are looking for new ways to avoid becoming the next target. In the last two years, the Department of Justice...more

Central District of California Dismisses FDIC’s Federal and State Securities Claims In Connection With RMBS Purchases

On August 26, Judge Mariana R. Pfaelzer of the U.S. District Court for the Central District Court of California dismissed with prejudice a suit brought by the Federal Deposit Insurance Corporation (FDIC) against Countrywide...more

Tenth Circuit Rules that “Extender Statutes” Permit NCUA to Bring Otherwise Time-Barred RMBS Suits

The Tenth Circuit has held that provisions of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (“FIRREA”) that extend the time period for a government regulator to bring “any action” on behalf of a...more

Rakoff Decision Supports Feds’ Broad Application of FIRREA

On August 16, 2013, Judge Jed S. Rakoff of the Southern District of New York issued a ruling in in United States v. Countrywide Financial Corp., No. 12 Civ. 1422, that will likely be relevant to any financial institution...more

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