Law Commons^™

The Lehman Brothers Bankruptcy E: The Effects On Lehman’S U.S. Broker-Dealer, Rosalind Z. Wiggins, Andrew Metrick

Journal of Financial Crises

Lehman’s U.S. broker-dealer, Lehman Brothers Inc. (LBI), was excluded from the parent company’s bankruptcy filing on September 15, 2008, because it was thought that the solvent subsidiary might be able to wind down its affairs in a normal fashion. However, the force of the parent’s demise proved too strong, and within days, LBI and dozens of Lehman subsidiaries around the world were also in liquidation. As a regulated broker-dealer, LBI was required to comply with the Securities and Exchange Commission financial-responsibility rules for broker-dealers, including maintaining customer assets separately. However, the corporate complexity and enterprise integration that characterized the Lehman …

The Lehman Brothers Bankruptcy B: Risk Limits And Stress Tests, Rosalind Z. Wiggins, Andrew Metrick

Journal of Financial Crises

Investment banks are in the business of taking calculated risks. Risk management infrastructure facilitates the safe pursuit of profits and the balancing of associated risks. By 2006, Lehman Brothers was thought to have a very respectable risk management system, and even its regulator, the Securities and Exchange Commission, viewed its risk framework as being fully compliant with regulatory requirements. In its public disclosures, Lehman characterized its risk controls as “meaningful constraints on its risk taking” and evidence of its continued financial stability. Beginning in late 2006, however, Lehman began dismantling its carefully crafted risk management framework as it pursued a …

The Lehman Brothers Bankruptcy A: Overview, Rosalind Z. Wiggins, Thomas Piontek, Andrew Metrick

Journal of Financial Crises

On September 15, 2008, Lehman Brothers Holdings, Inc., the fourth-largest U.S. investment bank, sought Chapter 11 protection, initiating the largest bankruptcy proceeding in U.S. history. The demise of the 164-year old firm was a seminal event in the global financial crisis. Under the direction of its long-time Chief Executive Officer Richard Fuld, Lehman had been very successful pursuing a high-leverage, high-risk business model that required it to daily raise billions of dollars to fund its operations. Beginning in 2006, Lehman began to invest aggressively in real-estate-related assets and soon had significant exposures to housing and subprime mortgages, just as these …

The Cfpb’S Endaround, Chris O'Brien

Catholic University Law Review

The financial crisis of 2008 led Congress to enact the Dodd-Frank Wall Street Reform and Consumer Protection Act and establish the Consumer Financial Protection Bureau (CFPB) to better protect consumers. Although Dodd-Frank and the CFPB introduced sweeping changes to many areas of financial lending, automobile dealers and financers were expressly excluded from oversight by the CFPB. Despite this express limitation on the CFPB’s authority, the Bureau nonetheless expanded its definition of “larger participants” to encompass automobile dealers and financiers. This action has resulted in duplicative regulatory oversight and increased costs to consumers, which in turn, imposes additional burdens on those …

Are We Heading Toward A Charter School "Bubble"?: Lessons From The Subprime Mortgage Crisis, Preston C. Green Iii, Bruce D. Baker, Joseph O. Oluwole, Julie F. Mead

University of Richmond Law Review

No abstract provided.

The Community Reinvestment Act: Guilty, But Not As Charged, Raymond H. Brescia

St. John's Law Review

(Excerpt)

With the goals of assessing the state of the research on the CRA and drawing some insights into what reforms this research suggests, this Article proceeds as follows. Part I provides an overview of the CRA's structure and reach. Part II provides an overview of the impact of the financial crisis on low- and moderate-income communities, particularly communities of color. Part III assesses the current state of the research, with particular emphasis on the NBER report described above. Part IV identifies the disconnect between the CRA's reach and its goals given the current state of banking and makes suggestions …

Why Reinvent The Wheel?—Protecting Consumers In The Wake Of The Subprime Mortgage Meltdown Without The Consumer Financial Protection Bureau, Brett J. Travers

Saint Louis University Law Journal

No abstract provided.

The Law And Economics Of Subprime Lending, Todd J. Zywicki, Joseph D. Adamson

University of Colorado Law Review

The collapse of the subprime mortgage market has led to calls for greater regulation to protect homeowners from unwittingly trapping themselves in high-cost loans that lead to foreclosure, bankruptcy, or other financial problems. Weighed against the losses of the widespread foreclosure crisis are the benefits of financial modernization that have accrued to many American families who have been able to become homeowners who otherwise would not have access to mortgage credit. The bust of the subprime mortgage market has resulted in high levels of foreclosures and unparalleled problems on Wall Street. However, the boom generated unprecedented levels of homeownership, especially …

Lessons From The Subprime Debacle: Stress Testing Ceo Autonomy, Steven A. Ramirez

Saint Louis University Law Journal

No abstract provided.

Federal Regulation And Legislation In The Wake Of The Subprime Mortgage Meltdown: A Legal Philosophical Analysis Of Federal Government Responses To Market Bubbles, Joshua Wirth

Fordham Journal of Corporate & Financial Law

No abstract provided.

Critical Mass: Restricting Advocates’ Rights Under The Community Reinvestment Act, Ruth S. Uselton

NYLS Law Review

No abstract provided.

Racial Disparities In Subprime Home Mortgage Lending In New York City: Meaning And Implications, Richard Marsico, Jane Yoo

NYLS Law Review

No abstract provided.

The Litigation Financing Industry: The Wild West Of Finance Should Be Tamed Not Outlawed, Susan Lorde Martin

Fordham Journal of Corporate & Financial Law

No abstract provided.