Banking

  • July 28, 2020

    NJ Biz Relocation Grants Taxable Income, 3rd Circ. Rules

    Some $56 million in New Jersey business relocation grants given to a financial services company cannot be excluded from the company's taxable income because there were no restrictions on how the funds could be used, the Third Circuit ruled Tuesday.

  • July 27, 2020

    Target Says Chubb Can't Weasel Out Of Data Hack Coverage

    Target Corp. is fighting Chubb Ltd.'s bid to avoid covering losses from $138 million in bank settlements over a 2013 data breach, saying that units of the insurer failed to show that the credit card data hack had not caused "loss of use of tangible property."

  • July 27, 2020

    Student Loan Co. CEO Given 3.5 Years For Debt Relief Scam

    A California financial services executive was sentenced to three and a half years in prison on Friday for wire fraud and money laundering charges connected to a phony multimillion-dollar student loan debt relief scheme.

  • July 27, 2020

    Senate GOP Unveils $1T Virus Relief Package

    Republican senators on Monday released a package of bills meant to provide further relief amid the coronavirus pandemic and continue cushioning its economic impact with new liability protections for employers and schools, additional funding for testing and health care, and a wide variety of tax incentives.

  • July 27, 2020

    Square Defends Ban On Bankruptcy-Related Transactions

    Square Inc. urged a California state judge Monday to uphold his tentative ruling ending a San Francisco bankruptcy attorney's suit that alleged it violated a state civil rights law by barring bankruptcy-related financial transactions on its service, arguing the prohibition isn't arbitrary occupational discrimination barred by the law.

  • July 27, 2020

    FINRA Says Calif. Firm Failed To Follow Its Own AML Policies

    The Financial Industry Regulatory Authority struck a settlement with a California-based securities brokerage on Monday, fining it for offenses stemming from the firm's alleged failures to catch red flags about potential money laundering despite having written procedures in place to catch them.

  • July 27, 2020

    Pot Credit Card Transactions Didn't Hurt Anyone, Rakoff Hears

    The U.S. government's fraud case against two businessmen who allegedly facilitated credit card payments for marijuana at dispensaries should be tossed because prosecutors failed to demonstrate any harm to the banks, a New York federal judge heard Monday.

  • July 27, 2020

    Banks Eye Energy Loan Sell-Off Amid Oil Downturn

    The prolonged oil slump is accelerating the efforts of many commercial banks to sell loans they've made to oil and gas drillers in order to reduce their exposure to the industry, with one bank recently striking a deal to unload its entire book of drilling loans.

  • July 27, 2020

    LendingClub Prevails Over Investors' Suit Over FTC Probe

    Fintech firm LendingClub succeeded in ending a proposed securities class action against it that alleged the company lied about a federal investigation, with a California federal judge ordering all claims dismissed Monday.

  • July 27, 2020

    Don't Give Ocwen An Early Win, Regulators Tell Fla. Judge

    State and federal regulators urged a Florida federal judge Friday not to grant an early win to mortgage servicer Ocwen Financial in enforcement litigation it faces, arguing a 2013 settlement the company agreed to did not bar the current action.

  • July 27, 2020

    8th Circ. Won't Revive Wells Fargo Workers' 401(k) Fight

    Wells Fargo workers lost their battle to revive claims that the bank violated the Employee Retirement Income Security Act by staying mum about a fraud scandal that hurt their 401(k) plans, as an Eighth Circuit panel said Monday that earlier disclosure isn't always better.

  • July 27, 2020

    Fidelity To Pay $22.5M To Escape TelexFree MDL

    Fidelity Bank has agreed to pay $22.5 million to resolve allegations it played a role in the massive TelexFree Ponzi scheme and will cooperate with plaintiffs still pursuing claims against other defendants, according to a settlement notice Friday.

  • July 27, 2020

    UBS Can't Shake FDIC's Libor-Rigging Claim In UK

    A judge refused on Monday to allow UBS AG to escape a lawsuit filed by the U.S. Federal Deposit Insurance Corp. accusing the Swiss bank of manipulating Libor, ruling that evidence that the lender colluded with rivals did not emerge until years later.

  • July 27, 2020

    3rd Circ. Upholds Pa. AG's Navient Claims Paralleling CFPB's

    The Third Circuit ruled Monday that the Consumer Financial Protection Bureau's governing statute allows for parallel enforcement by the agency and state attorneys general, upholding Pennsylvania's harmful practices claims against Navient Corp. that are similar to ones the agency is already pursuing.

  • July 24, 2020

    BofA, Others Escape European Gov't Bond-Rigging Suit

    A Manhattan federal judge has taken a knife to a proposed class action accusing Bank of America and other financial services heavyweights of a five-year conspiracy to fix European government bond prices, ruling that only the case's claims against Natixis SA and two Nomura subsidiaries may proceed.

  • July 24, 2020

    Feds' Nondisclosure Tests Premium Point Judge's Patience

    A federal judge who oversaw the trial of former Premium Point Investments CEO Anilesh Ahuja warned prosecutors on Friday that they have one last shot to set the record straight about their involvement in drafting a cooperator's guilty plea after failing to disclose that fact during and after trial.

  • July 24, 2020

    Judge Won't OK Atty Fees She Says Equal $7,500 An Hour  

    A California judge issued a tentative ruling Friday approving Merrill Lynch's $12.5 million wage and hour deal but rejected class counsel's $3.75 million fee bid, saying the case "was not particularly complicated" and their requested award would come out to $7,500 per billable hour.

  • July 24, 2020

    FDIC Eases Banks' Hiring Rules For Minor Criminal Offenses

    The Federal Deposit Insurance Corp. on Friday approved a new rule easing some requirements for people with minor criminal records who apply to work at banks, including expanding the scope of offenses that don't require written consent from the agency.

  • July 24, 2020

    Buyers Denied Cert. In Aluminum Antitrust MDL

    Aluminum buyers who have accused financial giants and metal warehouses of teaming up to hike the price of the metal have failed to convince a New York federal judge their issues are common enough to justify a class action.

  • July 24, 2020

    NY Asks 2nd Circ. To Affirm Block On Fintech Charter

    New York state's top financial regulator has asked the Second Circuit Court of Appeals to affirm a lower court decision blocking the OCC's fintech charter, reiterating the argument that taking deposits is central to the definition of the business of banking under the National Bank Act.

  • July 24, 2020

    DC Court Rules Alleged Crypto Launderer Dealt In 'Money'

    A Washington, D.C., district court struck down an Ohio man's attempts to escape charges tied to the alleged darknet cryptocurrency laundering operation he ran, ruling that the more than 350,000 bitcoins he transferred are "money" and subject to federal money transmission laws.

  • July 24, 2020

    10th Circ. Declines Rehearing Of Defunct Bank's Refund Row

    The Tenth Circuit on Friday denied a request by a defunct bank's corporate parent to rehear its decision to award a $4.1 million tax refund to the FDIC, after the U.S. Supreme Court had weighed in on the case.

  • July 24, 2020

    Insurer Must Cover Adviser In 'Rogue' Employee Suits

    Financial adviser Shurwest LLC has gotten a win in a dispute with its insurer over coverage in 11 suits by investors alleging it played a part in a former employee's scheme to market structured cash flow products from another company, with an Arizona federal judge ruling that the insurer has a duty to defend the suits.

  • July 24, 2020

    Investors Tell SourceHOV To Pay Up On Flawed $2.8B Deal

    Former investors in SourceHOV asked a New York federal court to make the company hand over cash owed to them after the Delaware Chancery Court found their shares were undervalued in a $2.8 billion merger.

  • July 24, 2020

    Goldman Sachs Strikes $3.9B Deal With Malaysia Over 1MDB

    Goldman Sachs has agreed to a $3.9 billion settlement of the Malaysian government's criminal case over the bank's role in the 1Malaysia Development Bhd. scandal, the country's finance minister announced Friday.

Expert Analysis

  • A Guide To Drafting Enforceable Arbitration Clauses

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    In addition to being faster and cheaper than litigation, arbitration may be the only ongoing means of resolving disputes during the pandemic, but these advantages can be lost if the arbitration clause in a contract fails to bind one or more parties to the transaction, say John Shope and Kevin Conroy at Foley Hoag.

  • COVID-19 Could Complicate Distressed Nonrecourse Loans

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    Because COVID-19 will have important ramifications for mortgages' nonrecourse carveouts and cash management provisions, real estate borrowers should weigh their ability to retain a pandemic-distressed property versus returning it to the lender, says Richard Spore at Bass Berry.

  • Do Dual Collateral Loans Impair NY Borrower Protections?

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    A New York state court's decision last month in HH Mark Twain v. Acres Capital reintroduces the question of whether dual collateral loan structures violate a borrower's right of redemption under New York law, obviating any certainty afforded by the 2018 decision in HH Cincinnati, says Emilie Cooper at Haynes and Boone.

  • 5 Biz Tax Reforms To Aid Long-Term Pandemic Recovery

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    As Congress negotiates another COVID-19 relief package, it should consider business tax measures that provide liquidity and encourage economic recovery by focusing budgetary resources on activities and circumstances connected to the pandemic and associated economic slowdown, says George Callas at Steptoe & Johnson.

  • Crisis May Trigger Collateralized Loan Obligation Litigation

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    As the pandemic-prompted downturn gives way to financial distress among companies that borrow using leveraged loans — which underpin collateralized loan obligations — CLO managers, third-party service providers and corporate borrowers alike may face litigation on multiple fronts, say Ioannis Gkatzimas and John Anthony at The Brattle Group.

  • 6 Dispute Prevention Steps As Lawsuits Rise Amid Pandemic

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    With the inundation of lawsuits resulting from the pandemic, now is an opportune time for companies and their advisers to implement prevention measures explicitly designed to break the dispute cycle early and to de-escalate possible legal actions as they form, says arbitrator and mediator Janice Sperow.

  • COVID-19 Relief Efforts Heighten Fair Credit Reporting Risks

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    Financial services companies should shore up documentation of credit reporting practices in anticipation of increased enforcement actions and civil litigation related to the Fair Credit Reporting Act and CARES Act compliance amid the COVID-19 crisis, say Allison Schoenthal and Ashley Hutto-Schultz at Hogan Lovells.

  • Money Laundering Enforcement Thrives In COVID-19 Era

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    Despite the COVID-19 pandemic, U.S. regulators are demonstrating a continued focus on anti-money laundering enforcement, and we can expect authorities will continue to make AML compliance — specifically, risk-based compliance — a priority, say attorneys at Miller & Chevalier.

  • Opinion

    Time To Consider Percentage Rental Agreements For Lawyers

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    It has long been the law that attorneys cannot use percentage rental agreements because doing so would constitute an impermissible sharing of fees with nonlawyers, but such arrangements can help lawyers match expenses with revenues in lean times like now, say Peter Jarvis and Trisha Thompson at Holland & Knight.

  • 7th Circ. Clarifies Test For 'Misleading' Debt Collection Letters

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    For debt collection litigation based on supposed misleading communications from collectors to consumers, the Seventh Circuit's recent decision in Johnson v. Enhanced Recovery Company makes clear that plaintiffs electing not to develop extrinsic evidence demonstrating confusion are in a precarious posture, say David Anthony and Jed Komisin at Troutman Pepper.

  • High Court Clarifies CFPB's Future, Complicates CFPB's Past

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    While the U.S. Supreme Court's decision in Seila Law this week leaves the Consumer Financial Protection Bureau standing, the CFPB's director now lacks protection from presidential termination, which brings uncertainty regarding the status of past actions taken by bureau directors who were "unconstitutionally insulated" from termination, says Eric Mogilnicki at Covington.

  • 'Settle And Sue' Malpractice Cases Have New Clarity In Calif.

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    A California state appellate court's recent decision in Masellis v. Law Office of Leslie F. Jensen provides a road map for proving causation and damages in settle-and-sue legal malpractice cases — an important issue of long-standing confusion, says Steven Berenson at Klinedinst.

  • The Litigation Risks In Main Street Lending Program

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    Lenders and borrowers in the COVID-19 Main Street Lending Program can steer clear of litigation roadblocks with proactive compliance measures, but the U.S. Department of Justice should also facilitate the program's objectives by issuing a policy statement limiting False Claims Act actions, say Robert Huffman and Caroline Wolverton at Akin Gump.

  • Time To Comply With SEC Regulation Best Interest, Form CRS

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    The compliance date has arrived for two rules adopted by the U.S. Securities and Exchange Commission last year — Regulation Best Interest and the Form CRS Relationship Summary — and there are many regulatory developments and legal questions that in-house counsel and compliance professionals should consider, say attorneys at Eversheds Sutherland.

  • What You Say In Online Mediation May Be Discoverable

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    Mediation conducted online with participants in different states makes it harder to determine where communications were made, increasing the risk that courts will apply laws of a state that does not protect mediation confidentiality, say mediators Jeff Kichaven and Teresa Frisbie and law student Tyler Codina.

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