Mortgage/Foreclosure follow-up

As follow-up to our mortgage-funding/home foreclosure post earlier this week, American Lawyers' AmLaw Daily report yesterday cited Christy Romero, TARP's new inspector general’s, scathing report of the nation's so-referred "Hardest Hit Fund," which was meant to help struggling homeowners address foreclosure issues.

That report, issued while she was still serving as TARP's acting inspector general, chastised Bingham, Cadwalader, Wickersham & Taft, Locke Lord, and Simpson Thacher & Bartlett for what she said were their sometimes vague billing practices and the Treasury Department for failing to adequately monitor those bills. While the 76-page document Romero put out last week did not single out specific firms, it did serve as a reminder that plenty of Am Law 100 and Second Hundred firms have reaped the benefits of taking on TARP assignments.

AmLaw's post continues, "As for TARP—a program established by the Emergency Economic Stabilization Act of 2008 in the waning days of the George W. Bush's second presidential term—about 20 firms have legal advisory contracts tied to the program, according to a March report filed by Treasury to Congress. Sibling publication The American Lawyer reported two years ago (LexisNexis subscription article) on the total value of some of those TARP contracts, which are capped at $100 million. (The Am Law Daily has reported separately on Treasury's decision to hire 13 firms to help run programs—like the Hardest Hit initiative—that ran past TARP's expiration date.)" Additional information on those contracts—which are mostly boilerplate agreements for legal advice on investments, asset-backed security deals, debt transactions, mortgage loan modifications, other mortgage-related legal issues, or restructuring matters— are explored in the remainder of the posting.

Meanwhile, another AmLaw publication writes of another tiff, this time between the ABA and the U.S. Consumer Financial Protection Bureau, with the latter saying it has the right to see information protected by the attorney-client privilege or the work product doctrine as it promotes fairness and transparency in mortgages, credit cards, and other consumer products. Disagreeing, the ABA sent a comment letter to the CFPB earlier this week, objecting to a proposed rule that gives the agency the right to demand that all banks and other supervised financial entities submit privileged information to the bureau during examinations.