Law Commons^™

The Systematic Risk Of Private Funds After The Dodd-Frank Act, Wulf A. Kaal

Michigan Business & Entrepreneurial Law Review

The Financial Stability Oversight Council (FSOC) was created under the Dodd-Frank Act with the primary mandate of guarding against systemic risk and correcting perceived regulatory weaknesses that may have contributed to the financial crisis of 2008-2009. The Securities and Exchange Commission (SEC) collects data pertaining to private fund advisers in order to facilitate FSOC’s assessment of non-bank financial institutions’ potential systemic risks. Evidence that the SEC’s data collection encounters accuracy and consistency problems might hamper FSOC’s ability to evaluate the systemic risk of private fund advisers. The author shows that while the SEC’s data plays a crucial role in all …

A Good Rule, Poorly Written: How The Financial Crisis Highlighted The Inadequacy Of Iolta Rate Rules, Andrew Arthur

Catholic University Law Review

Interest on lawyer trust accounts (IOLTA) provide a substantial component of funding that is used to provide legal aid to needy individuals throughout the United States. However, IOLTA program revenues fluctuate with the deposit interest rates, which have remained near zero after the onset of the 2008 global financial crisis. The Comment examines IOLTA rate rules across the country, and the impact of reduces IOLTA revenues on legal aid programs. The Comment further asserts that IOLTA rate rules are not adequately designed to account for fluctuation in central bank interest rates, causing unanticipated problems for legal aid funding. Finally, the …

The Art Of A Loan: “When The Loan Sharks Meet Damien Hirst’S ‘$12-Million Stuffed Shark’”, Valerie Medelyan

Pace Law Review

Part I of this Article introduces the reader to the typical types of loans that banks make, includes an in-depth description of a secured loan, and finishes with a discussion of the due diligence requirements of banks. Part II identifies the unique complexities posed by art when it is used as collateral, comparing and contrasting the banks’ process when approving a loan secured by commonly-used assets versus a loan secured by art. Part III discusses the banks’ growing willingness to approve art-backed loans, and identifies the safeguards built into such deals. Part IV introduces the sub-prime lenders of the art …

The New Synthesis Of Bank Regulation And Bankruptcy In The Dodd-Frank Era, David A. Skeel Jr.

All Faculty Scholarship

Since the enactment of the Dodd-Frank Act in 2010, U.S. bank regulation and bankruptcy have become far more closely intertwined. In this Article, I ask whether the new synthesis of bank regulation and bankruptcy is coherent, and whether it is likely to prove effective.

I begin by exploring some of the basic differences between bank resolution, which is a highly administrative process in the U.S., and bankruptcy, which relies more on courts and the parties themselves. I then focus on a series of remarkable new innovations designed to facilitate the rapid recapitalization of systemically important financial institutions: convertible contingent capital …

Can Banks Be Liable For Aiding And Abetting Terrorism?: A Closer Look Into The Split On Secondary Liability Under The Antiterrorism Act, Alison Bitterly

Fordham Law Review

The Antiterrorism Act of 1990 (ATA) explicitly authorizes a private cause of action for U.S. nationals who suffer an injury “by reason of an act of international terrorism.” ATA civil litigation has increased dramatically following September 11, 2001—and banks, because of their deep pockets, have emerged as an increasingly popular target. Courts are divided concerning the scope of liability under the statute, specifically over whether the ATA authorizes a cause of action premised on secondary liability. Under a secondary liability theory, a plaintiff could argue that a bank, through providing financial services to a terrorist client, aided and abetted an …

Plaintiffs Carry Heavy Burden In Terror Suits Against Banks, Jimmy Gurule

Journal Articles

Plaintiffs have a heavy burden to prove that the provision of routine financial services to suspected terrorists violated the ATA. While plaintiffs clearly met their burden in the Arab Bank case, that case did not involve the provision of routine banking services. Further, in the Palestinian Authority case several of the individuals who committed the terrorist attacks worked for the authority and were monetarily rewarded for their acts of terrorism.

Plaintiffs' lawyers in pending bank cases filed under the ATA therefore should be hesitant to read too much into the Arab Bank and Palestinian Authority verdicts.

Accountability And Independence In Financial Regulation: Checks And Balances, Public Engagement, And Other Innovations, Michael S. Barr

Articles

Financial regulation attempts to balance two competing administrative goals. On the one hand, as with much of administrative law, accountability is a core goal. Accountability undergirds the democratic legitimacy of administrative agencies. On the other hand, unlike with much of administrative law, independence plays a critical role.' Independence helps to protect financial regulatory agencies from political interference and-with some important caveats-arguably helps to guard against some forms of industry capture. In addition, with respect to the Federal Reserve (the Fed), independence serves to improve the credibility of the Fed's price stability mandate by insulating its decisionmaking from politics and, in …

Super-Liens To The Rescue? A Case Against Special Districts In Real Estate Finance, Christopher K. Odinet

Christopher K. Odinet